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Cecily Hall WWD
MIDTOWN: FIFTH AVENUE, BETWEEN 49TH AND 59TH STREETS

MIDTOWN: FIFTH AVENUE, BETWEEN 49TH AND 59TH STREETS


New York's top retail corridors ranked by their changes in average asking rents per square foot.



Though real estate activity throughout the nation has been challenging, New York's retail market is booming. "Retail has really been the strongest market in all real estate sectors for the city," said Mike Slattery, senior vice president of the Real Estate Board of New York, which recently released its spring 2008 report. "Real estate here is driven by tourism, and by companies who are looking for high-profile locations — the 'need to be here' aspect has kept demand high." This year, the firm's report reassessed New York's major corridors in order to account for some up-and-coming areas witnessing a boom in retail activity. Examples include Fifth Avenue south of 49th Street, Bleecker Street in the West Village and 14th Street in the Meatpacking District — these corridors do not appear on the list, however, due to the lack of year-over-year comparisons.


1. MIDTOWN: FIFTH AVENUE, BETWEEN 49TH AND 59TH STREETS

Change in average asking price: 110.1 percent — 2008: $1,958; 2007: $932

"This has always been a premier, high-profile location," said Slattery. "The change in asking price reflects the general improvement in the market, which continues to pick up speed....People want to be there." Situated along this corridor are some of Manhattan's top department and specialty stores: Saks Fifth Avenue is at 55th Street, while Bergdorf Goodman and Bergdorf Men's can both be found at 58th Street. Henri Bendel, Abercrombie & Fitch, Tiffany & Co. and Fortunoff have flagships here as well. Just north of St. Patrick's Cathedral, Cartier, Louis Vuitton and Versace have set up shop. And Giorgio Armani is building its flagship at 56th Street, slated to open early next year.

2. EAST SIDE: THIRD AVENUE, BETWEEN 60TH AND 72ND STREETS
Change: 51 percent — 2008: $329; 2007: $218

"National chains are discovering a slice of the Upper East Side pioneered by independent boutiques," WWD reported in April. Specialty boutiques, such as Big Drop, Diabless, Cantaloupe and Precision cater to the affluent neighborhood, which boasts one of the highest concentrations of wealth in the U.S. But the area is witnessing more national players such as Banana Republic, Ann Taylor and Coldwater Creek jumping into the game. Most recent entrants include Lululemon and Bebe. Lisa Rosenthal, a retail broker at Ripco, explained that growth is stemming from two major sources along the southern end of the corridor: the Bloomingdale's flagship at 59th Street and Hunter College.

3. FLATIRON: FIFTH AVENUE, BETWEEN 14TH AND 23RD STREETS
Change: 50.2 percent — 2008: $401; 2007: $267

Anchoring this corridor is the historic Flatiron Building, originally called the Fuller Building, which was completed in 1902. The building, at 175 Fifth Avenue, sits on a triangular island block at 23rd Street. To the south is one of the hottest shopping areas in town. Along Fifth Avenue, stores such as Armani Exchange, Coach, Kenneth Cole, Anthropologie and Intermix — which offers designer fashions from the likes of Dsquared, Ella Moss and Theory — line the avenue, attracting plenty of shoppers from the Union Square area, the southern anchor of the corridor, where Diesel, DSW, Whole Foods, Forever 21 and Filene's Basement all have locations.

4. HERALD SQUARE: 34TH STREET, BETWEEN FIFTH AND SEVENTH AVENUES
Change: 32.3 percent — 2008: $656; 2007: $496

Thanks to destinations such as the Empire State Building, Penn Station and Madison Square Garden, retailers here benefit from plenty of foot traffic. The corridor boasts locations from Victoria's Secret, Foot Locker, H&M, Old Navy, Forever 21 and Steve & Barry's, but its biggest retail star is Macy's Herald Square. The department store will be opening bridge and fashion jewelry shops this month and luggage in September, and last month opened new mattress, men's and sunglass areas. The store is also upgrading fitting rooms, rest rooms and service departments such as MBA personal shopping and bridal.

5. SOHO: BROADWAY, BETWEEN HOUSTON AND BROOME STREETS
Change: 32.1 percent — 2008: $424; 2007: $321

Some of retailing's best-known brands are situated along this corridor, including Club Monaco, Banana Republic, Tommy Hilfiger, Old Navy, H&M, Puma, Lucky Brand Jeans, Ann Taylor and Sephora. Coming this fall: British fashion powerhouse Topshop, which is opening a 40,000-square-foot, tri-level flagship at 478 Broadway. The location will be the retailer's first in the U.S. The area also is home to many upscale hotels, such as the Soho Grand, along with restaurants like Mercer Kitchen and Balthazar.

6. WEST SIDE: BROADWAY, BETWEEN 72ND AND 86TH STREETS
Change: 22.7 percent — 2008: $384; 2007: $313

Retailers with stores here include Loehmann's, Barneys Co-op and Filene's Basement, but there also are Central Park and the American Museum of Natural History. The corridor is well-situated between Columbia University to the north and The Shops at Columbus Circle to the south. The Shops contains retailers such as Coach, Stuart Weitzman, J. Crew and L'Occitane, and a Whole Foods Market is located on the concourse level.

7. FINANCIAL DISTRICT: BROADWAY, BATTERY PARK TO CHAMBERS STREET
Change: 11.9 percent — 2008: $198; 2007: $177

"When we started this report in 2000, there was no retail interest in downtown," admitted Slattery. "Much of the retail was located inside the World Trade Center, and there were no real high-profile stores there." How times have changed. "The demand is clearly a by-product of post-9/11. People want to reestablish their presence, their locations there now. More visible names are coming back here." Those names include Tiffany & Co. and Hermès. And Century 21 department store, whose location across from the World Trade Center site survived the 9/11 attacks, has remained in its spot for nearly half a century.

8. HARLEM: 125TH STREET, RIVER TO RIVER
Change: 3.9 percent — 2008: $107; 2007: $103

Of the study, Harlem's corridor is the longest and the largest. Slattery also pointed out, "The west end of the corridor is a strong location," he said. "We think the area is probably benefiting from Columbia University, along with the Upper West Side and high-income neighborhoods that are pushing northward." Clothing retailers along the corridor range from large-scale stores like H&M and Old Navy to smaller names like Mony, which sells urban streetwear at discount prices, and Brownstone, a cafe and boutique that features more than 40 independent clothing designers. Entertainment venues such as the Apollo Theater, the Cotton Club and Sylvia's restaurant are also filling up prime spots.

9. MIDTOWN: BROADWAY AND SEVENTH AVENUES, 42ND TO 47TH STREETS
Change: -3.7 percent — 2008: $809; 2007: $840

This corridor, having been reconfigured by the REBNY report over the past year, accounts for the bulk of retail offerings in the Times Square area. "From its once-tawdry past (which, for the nostalgically inclined, can still be found nearby), the area has been transformed into the ultimate consumer's paradise — one so glittery and gussied up that it's almost surreal," noted Timessquare.com. Large retailers such as Toys 'R' Us and Virgin Megastore are here, as are Sephora, Quiksilver and Modell's. And, in addition to the remaining souvenir shops, Hershey's, M&M's and even CBS have retail stores along the corridor.

10. EAST SIDE: MADISON AVENUE, BETWEEN 57TH AND 72ND STREETS
Change: -7.9 percent — 2008: $1,066; 2007: $1,158

Jewelers such as Fred Leighton and Baccarat have sites here, while apparel boutiques include Bottega Veneta, Dolce & Gabbana, Yves Saint Laurent and Prada. Barneys New York, located at 660 Madison Avenue, has been in the location for 15 years. Earlier this spring, the specialty store redesigned its sixth floor in order to look and feel more like a "designer" floor, Judy Collinson, women's merchandise manager, told WWD in April. The floor features Stella McCartney, Erdum, Marc Jacobs, Marni and Miu Miu. Both floors five and six will have a large group of growing designer businesses, such as The Row, Thakoon, Duro Olowu and Lutz & Patmos.

11. TRIBECA: HUDSON STREET, BETWEEN CHAMBERS AND CANAL STREETS
Change: -17.5 percent — 2008: $113; 2007: $137

The negative change in this corridor's asking rents is not a sign that the neighborhood's in trouble: "TriBeCa is hot and continues to be in demand," said Slattery. "Trying to find ideal locations for tenants is just really challenging right now. The percent change is more a reflection of the inventory, there's definitely not a downward trend in pricing." In fact, tenants like Issey Miyake and Nobu Next Door restaurant have had their locations here since 2001 and 1998, respectively. And at 330 Hudson Street, a $220 million redevelopment is in store: Developers plan to create a 410,000-square-foot rentable property, including a luxury boutique hotel, office space and retail spaces.

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