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NEW YORK CITY-A CB Richard Ellis report issued Wednesday says Manhattan’s retail rents show continued decline in the third quarter, but adds there are signs that this decrease may be slowing. In fact, two of the 10 most popular shopping districts on the island saw increases in average rents from the second quarter to the third this year.

Besides that, the silver lining in the depreciated rents has been the opportunity for a number of tenants, previously fenced out of Manhattan market by exuberant rents, to become active here. As a result, big box stores like TJ Maxx and Kohls are currently shopping for space throughout the city, according to the report.

Another change CBRE points out is the newfound willingness by some landlords to do short-term deals, leading a few well-known designers as well as big-name retailers to launch seasonal new pop-up stores.

But, despite all that, statistics show that consumers are still holding tight to their cash and repaying debts, and that probably means a flat holiday sales season. However, on the ground here in Manhattan, retailers and retail real estate brokers sense a bottom is here and if they are correct, a rebound might be just right around the next corner.

“Last September, we all saw retail go into a free-fall as people hermetically sealed their wallets,” Alison Lewis, senior managing director at CBRE Retail, tells GlobeSt.com. However, “this September was a more positive month as people began looking forward. There’s just so much more activity.”

That kind of activity pushed average asking rents on the Broadway corridor from Battery Park to Chambers Street up over the last quarter by 10.87% from $209 to $234. In the trend-driven Soho area, on Broadway, between Houston and Broome, rents ticked up .41%. from $481 to $483. Meanwhile, the Upper East Side’s Madison Avenue corridor from 57th to 72nd Street, as well as Herald Square’s 34th Street corridor between Fifth and Seventh avenues, saw increases in leasing activity as Esprit, Aeropostale and Levis set up shop taking around 35,000 square feet on 34th Street, as well as a number of smaller deals on Upper Madison.

“Richard Hodos did a deal on behalf of Coach, the luxury retailer, at 831 Madison,” says Lewis, noting the new store will be a first of its kind new label by Coach creative director Reed Krakoff. Lewis says after some competition for the space, Coach is paying close to asking for what she called a “fabulous space,” because “they know the power of the Madison Avenue and the association with the brand.”

Meanwhile, Manhattan retail maven Faith Hope Consolo, chairman of Prudential Douglas Elliman’s retail leasing, marketing and sales division, has declared that the bleeding has stopped. She says she’s inked a number of new deals, and has about six new deals on Madison and another in Soho.

“There’s a retail rebound, and I expect the rents to inch up, and by year’s end, I think we’ll be somewhere between 3% and 5%,” Consolo tells GlobeSt.com. She says “those numbers sound small compared to what we’ve seen years before, but I think we’ll be somewhere around the 2004-05 levels.”

Consolo acknowledges that there was a great deal of inflation in 2006 and 2007 that blew it off the charts and as a result some neighborhoods did become overpriced.

“I can say that because I’m one of the brokers that pushed the envelope,” she says. Regardless, she says, “there’s real activity flow for all sizes, from 500 to 50,000 square feet.”

Noting record numbers of international tourists expected over the next few years, Consolo says to truly measure the temperature of the retail climate, one has to be “in the game, entrenched in what’s happening in all 250 retail districts throughout New York City.”

Fort example, in the Soho area, on Broadway, “you’ve got tourists, some who walk all the way from uptown; these are hotspots with wall to wall people,” says Consolo.

Lewis says she was recently with an international client on the Broadway corridor when she found herself wondering what all the shoppers, bags in tow, do for a living, considering that it was a weekday afternoon. “I think that area is a bit more resilient since it pulls from a variety of demographics,” she says. “So if one is hurt, they don’t pull from the rest of the group.”

Clearly, Manhattan retail differs from neighborhood to neighborhood as shopping corridors take on the flavor of the area. Lewis tells GlobeSt.com that “it really makes a big difference about your brand and image, what neighborhood you locate in.”

She stresses that the economy does in fact impact that. “That’s why Madison Avenue on the Upper East side was hit so drastically; it’s the high end, luxury, jewelry, boutique apparel,” Lewis says. She adds during the good times the high prices spread, as more and more people found themselves astonished that rents on Fifth were rising to Upper East Side levels. But as Lewis notes, Fifth Avenue is like “beachfront property.”

And, as the CBRE report shows, Hurricane “Great Recession” wreaked havoc on that Fifth Avenue property, most especially in the stretch between 42nd and 49th streets, where rents declined 56.92% compared to the fourth quarter 2008.In the end, though, Lewis and the CBRE team are cautiously optimistic that retail across the city is in for better times. “Obviously, you have to get into the marketplace, and be active, and start exchanging paper to get to the final step where deals were being made,” she says adding, “I definitely see things improving, but, a lot of people are still waiting to see how the holiday season plays out.”

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