Retail’s Big Renaissance

From Greenwich Village to upper Madison Avenue, average rents are inching upward. But is it a glitch, or are the good times here to stay?

The expansions are not without stumbles. Brokers had speculated that the area north of 25th Street on Madison would explode, but it has not picked up as they had hoped, said Gene Spiegelman, an executive vice president of brokerage with Cushman & Wakefield.

“People thought there’d be a reason to have retail there, but nothing has evolved,” he said. “So, not everything gentrifies.”

But, he added, retail in Manhattan “has really embraced a river-to-river philosophy … In the late ’70s, early ’80s, you didn’t go to these places—you didn’t walk there, you didn’t go to Times Square, you didn’t go to the Upper West Side, you certainly didn’t go to the Meatpacking District,” he said. “They were dangerous—simply dangerous.”

Other areas to keep an eye on include Lower Manhattan, a glaring example, with the multifaceted development projects happening there, Hell’s Kitchen, Hudson Yards, Harlem, along 126th Street, NoMad, and points north of Mario Batali’s Eataly in Chelsea, brokers said.

“I have my eyes on the NoMad neighborhood, with its potential for further reinvention in the mid-term, the Far West Side as a potential long-term play and Hudson Square with its pending rezoning,” added Mr. Schorsch of American Realty Capital.

A microcosm of the southern expansion seen along Fifth and Madison Avenues is occurring on Bleecker Street in Greenwich Village. The prime area of the street—home to big names like Marc Jacobs, Ralph Lauren, cosmetics brand Fresh and Coach—lies primarily between cross streets West 10th and West 11th.

But notable retailers are expanding south there too, between Christopher Street and Bleecker’s intersection with Seventh Avenue South, set off by the recent entry of clothing retailer Saint James and the signing of a lease by Jeremy Argyle.

“You had a consistent boundary for a long time that’s now being broken down,” said Brendan Gotch, a director of retail leasing at Massey Knakal. “The two blocks in between Christopher Street and Seventh Avenue South have always been like a different world—it was lower-end retail, it was salons, laundry and those kinds of things, and suddenly just this year we’ve seen two or three big leases signed right over there.”

“These two blocks are going to be wildly different,” he added. “Everybody’s sort of been waiting for a long time for this to flip over. The question immediately after this becomes, when does it cross Seventh Avenue?”

Follow Al Barbarino on Twitter or via RSS. abarbarino@observer.com
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