CREW New York Event Assembles Expertise on the City’s Recovering Retail 

New York City’s retail sector continues to gather an immense amount of momentum behind it, despite persistent headwinds such as the rising cost of goods and the higher costs of travel. 

While retail spending has been pretty flat for most of 2024, consumer confidence has improved compared to last year — although it’s still lower than pre-pandemic levels — and the availability of retail space in New York City has dropped year-over-year in eight out of 12 submarkets.

During the Sept. 10 luncheon for the Commercial Real Estate Women New York (CREW New York), leaders from top retail real estate-related firms discussed what they are seeing in the market from their individual viewpoints, outlined key opportunities and challenges their teams face, and described what is working best for their companies today.

Cathy Cunningham, executive editor of Commercial Observer, moderated the luncheon’s panel titled “Retail Resurgence: Trends, Challenges and Opportunities in NYC,” picking the brains of Joanne Podell, vice chairman at Cushman & Wakefield; Sonia Lapinsky, partner and managing director at AlixPartners; Kelly Curtin, executive vice president of NYC Tourism + Conventions; and Whitney Arcaro, chief revenue officer of RXR.

Lapinsky kicked things off with a macro overview of the current state of retail. 

“If we look at consumer confidence over the last year, we definitely see some reason to be optimistic,” Lapinsky said. “Total retail sales are up 2.3 percent year-over-year as of May, and when we check the latest numbers in July it is actually at 2.7 percent, so we’re on the right track. … [But] e-commerce sales have slowed, and other areas of the retail and consumer sector are slowing as well.”

Like the city itself, New York’s retail sector is undergoing a constant evolution. That said, some of the concepts and buzzwords from the challenging pandemic days are still around, but have morphed significantly as retailers continue to innovate. Case in point: “experiential retail.” 

“I used to always say, ‘Enough about experiential,’ because to me experiential has been around forever,” Podell said. “Thirty-four years ago, you’d go buy makeup and somebody would help you to pick out what you wanted. What’s happening now is this great shift into the experience of being [in a store] and what can you learn from being there.”

Podell also spoke to luxury retailers purchasing their buildings on, for example, Fifth Avenue as a standout trend for New York City of late. Those headline-grabbing transactions include Prada buying 720 Fifth Avenue from Jeff Sutton last December and Gucci parent Kering purchasing 715 Fifth Avenue for $963 million in January, also from Sutton. 

With a bid currently under review to bring a casino to Times Square, panelists mulled whether luck might be a lady in bringing new visitors, retail, and food and beverage options to the pulsating intersection, but agreed that it will have its work cut out competing with better established locations — for example, Las Vegas — as a shopping and entertainment destination. 

Still, Times Square sees 50 million tourists annually, which is critical to the New York Cityretail sector’s overall success. Thankfully, the amount that people are traveling post-pandemic has almost fully recovered, with hotel occupancy at around 91 percent of where it was in 2019, according to Curtin. However, higher costs for staying in hotels and eating out are actually harming the sales figures they’re targeting.

“Let’s say a tourist from South America comes to New York, maybe every five years or so they would buy four pairs of shoes,” Curtin said. “They’re only buying three pairs now because their hotel is a little bit more expensive. But we’re very optimistic. It was a good summer for tourism.”

Curtin has her hands full planning for the World Cup in 2026, when New York City will host the final game. She’s expecting a huge surge in visitors, but also expects an immense number of eyeballs on the city as viewers tune in from every corner of the globe — which she said can only be good for future tourism and retail. 

Founded in 1978, CREW New York has about 250 members offering resources to help women advance their careers in the commercial real estate industry through networking events, leadership development and market research.

Mark Hallum can be reached at mhallum@commercialobserver.com.