UES Avenue Still Struggling To Rebound From COVID, Study Finds

UPPER EAST SIDE, NY — Though it feels like the city has bounced back from the depths of the pandemic, some sectors are recovering more slowly — including retail, as evidenced by one Upper East Side corridor.

Madison Avenue between East 57th and 72nd streets had 55 ground-floor retail openings during the second quarter of 2021, according to a new report by the real estate firm CBRE. That's more than any of the hallmark shopping streets studied in the report, including Fifth Avenue in Midtown and Broadway on the Upper West Side and SoHo.

It represents a 25 percent increase from the end of 2020, when there were 44 open storefronts.

"Stagnant inventory and a lack of new demand continue to make the Upper Madison corridor a challenging draw for new retailers," researchers wrote, citing declining interest in luxury goods and a shift in the market toward Lower Manhattan.

In a sign of progress, the average asking rent on Madison rose from $731 to $773 per square foot during the first two quarters of this year. Still, that is 12 percent lower than the $882 average rent on the avenue at this point last year.

High-profile storefronts that came on the market last quarter include the Givenchy boutique on Madison and East 65th Street and the Sergio Rossi shoe store near 61st.

"Certainly, there are more availabilities than we would like," said Matthew Bauer, president of the Madison Avenue Business Improvement District, about the open retail spaces.

But Bauer pushed back strongly against the notion that the avenue is stagnant. He shared a list compiled by the BID showing 15 businesses that have opened in recent months along Madison, plus nine upcoming openings and seven expansions of existing businesses.

Among the highlights: new restaurants like Tuscan Provisions on East 69th Street; the Frick Madison museum; William Greenberg Desserts' expansion into the next-door shop at 1100 Madison Ave.; and the new Corinthia Hotel at the former Surrey building on 76th Street, which will itself contain the upscale restaurant Casa Tua.

"There is a tremendous amount of investment," Bauer said. "You're talking about a street where both Hermès and Giorgio Armani are building brand-new stores."

Bauer also pointed to three mixed-use developments set to alter the neighborhood's skyline: the Armani building at 760 Madison and two towers by the Naftali Group at 1045 and 1165 Madison.

To usher along the neighborhood's recovery, the Madison Avenue BID plans to keep hosting special events, launching promotions like a new customer loyalty program, and cleaning up streets to make them attractive for businesses.

Though Madison Avenue is known for drawing shoppers from around the globe, Bauer said its recovery will ultimately rest in the hands of Upper East Siders.

"The primary clients on Madison Avenue are still very local," he said. "When it all comes down to it we’re really a local shopping neighborhood."