New York Retail Market Report

Recovery in New York County lifts retail outlook. The metro’s retail landscape enters 2025 on strong tailwinds after its job growth rate climbed into the nation’s top 10 last year, supporting income growth in the upper tier of major markets. Expanding affluent neighborhoods in Brooklyn and Northeast Queens are expected to experience sustained demand from necessity-oriented tenants, with leasing activity historically elevated in 2024. Vacancy in the Bronx and South Queens should remain tight despite financial pressures that could impact lower-income households, while Downtown Brooklyn may lag amid a slower office recovery. In contrast, rising tourism and office occupancy in Manhattan will aid retail leasing, particularly in Midtown, where vacancy fell in 2024 for the first time since 2019. Congestion pricing may further reshape leasing dynamics if upheld. Foot traffic within the zone rose 4.6 percent in January, compared with the same month in 2024. Tenants with minimal delivery needs, such as service providers and those selling low-turnover goods, may benefit the most.