CBRE Group, Inc. released its Manhattan Retail MarketView report for fourth quarter 2012, which found that New York City’s record high of 52 million tourists last year were a huge spending force propelling Manhattan’s increasingly hot retail corridors.
Citing various sources, CBRE reported that New York City welcomed 52 million visitors in 2012, a 2.1% increase over 2011.
Of those visitors, 41 million were domestic and 11 million were international. These visitors generated an estimated $55.3 billion in revenue, with direct spending reaching $36.9 billion.
“It was a good year for retail, as New York had its best year for tourism, which translates to better retail sales and hotels at higher occupancies,” said Andrew Goldberg, executive vice president, CBRE Retail group.
“Tourism has driven business to New York’s primary retail corridors and retailers are expanding in their current space, growing store counts, doing new flagships and seeing growth.”
Among the hottest retail corridors in the last quarter was upper Madison Avenue, which saw its average asking rent rise to 10.6%, the largest quarter-over-quarter increase of Manhattan’s major retail corridors.
The luxury corridor saw a year-over-year increase of 30.8%, from $1,013 per square foot, to $1,325 per sq. ft., indicating a continued confidence in high-end retail.
Average asking rents in the Times Square Bowtie increased 8.6% in Q4 2012, contributing to a 41.9% year-over-year increase. Since 2011, multiple high-profile, high-priced spaces have been brought to market in the heavily trafficked corridor.
The 34th Street retail corridor, which features the iconic Macy’s, as well as national retailers such as American Eagle Outfitters, Footlocker, H&M and Victoria’s Secret, is an increasingly strong market, according to the report.
“Thirty-Fourth Street is a primary retail market in Manhattan and it’s getting a lot of attention of late,” said Mr. Goldberg.
“There are a lot of big name retailers, there’s some availability, a lot is happening and the neighborhood is on every major retailer’s hit list, as many of them are finding that 34th Street is among their highest-grossing stores in the world.”