The Real Estate Board of New York (REBNY) reported a "strong retail recovery continues" in Manhattan for the first quarter, a finding that aligns with overall market trends, according to the organization's latest report. This assessment comes even as some prominent retail spaces remain unoccupied.

Despite the overall positive outlook, REBNY's survey has limitations, as it omits certain key areas such as Midtown Sixth Avenue. Large, visible storefronts in this corridor, like the former Gap space at 1212 Sixth Avenue, have stood vacant for years, despite efforts by major retail brokers to secure tenants.

The report also does not cover Fifth Avenue between East 34th and East 42nd Streets, an area where a significant portion of the east blockfront between 38th and 39th streets remains vacant, directly opposite the former Lord & Taylor store now housing the Amazon-owned food court Shaver Hall.

However, several positive trends were noted. Bleecker Street, between Seventh Avenue South and Hudson Street, has only one small storefront available, pushing retailers to seek alternatives like West Street. Fifth Avenue in the Flatiron district has become a preferred location for new-to-city brands, with companies like Canada's Garage and Cozey occupying the former Club Monaco space at 160 Fifth Avenue.

Madison Avenue north of East 57th Street is experiencing high demand from Italian fashion brands. With limited availability in prime spots, these brands are opting for nearby side streets, such as Milan-based LDJ (La DoubleJ), which has leased an entire townhouse at 18 E. 69th St.

In Herald Square, average asking rents increased from $383 in the latter half of 2025 to $412 currently, reflecting increased demand from larger retailers. This includes a 40,000-square-foot TJ Maxx store at Herald Towers.

Times Square is also seeing non-entertainment businesses take over large spaces, such as Nan Xiang Dumplings, which acquired the former TGI Fridays location at 147 W. 46th St.

Supporting the trend of significant retail leases, luxury jeweler David Yurman is set to open a 22,000-square-foot flagship store at 685 Fifth Avenue. The current tenant, Coach, plans to relocate to a nearby space at 645 Fifth Avenue later this year. These developments align with observations from Cushman & Wakefield's Steven Soutendijk, who noted that deals for nearly all major vacant Fifth Avenue storefronts are pending and expected to be announced by year's end.