Store of the Future   //   March 8, 2024

‘Foot traffic is incredible’: Midtown Manhattan is once again a retail hot spot

After a period of rapid expansion, ear piercing studio Studs was searching for a new location to kick off 2024. In New York City, it already had stores in Williamsburg, Hudson Yards, Flatiron, the Upper East Side and Nolita. However, “we didn’t yet have a central Midtown location to serve tourists and locals who work in the area,” co-founder and CEO Anna Harman told Modern Retail.

Studs ultimately turned to Rockefeller Center, fresh off a recent renovation, as its newest home. Its new store opened on March 1, joining a long list of businesses that have recently come to Midtown. While Midtown has long been a mainstay for luxury brands, brands of all types are now starting to open up in the neighborhood. Citizen and Swarovski opened flagship stores on Fifth Avenue in December. Abercrombie & Fitch relocated its flagship to an even bigger location on Fifth Avenue in July. Madewell opened its revamped Fifth Avenue flagship last summer, complete with a new denim atelier concept.

For years, retailers have flocked to set up shop in “it” neighborhoods in New York City. Before the pandemic, as well as during the first couple years of its recovery, Soho and Nolita reigned supreme, with Valentino, Wilson’s Sporting Goods and Vuori all opening stores there. Williamsburg has also been buzzy among DTC businesses, thanks to its chic cafes, thrift stores and waterfront views.

Now, tides are shifting, and brands of all types and sizes — not just high-end ones — are making the move to Midtown. Much of this is due to a major revamping of Rockefeller Center, which encompasses six square blocks. All in all, it’s a promising sign for the continued post-pandemic recovery of New York City, one of retail’s biggest markets and a major business capital.

The evolution of Midtown

Midtown, home to Radio City Music Hall and Grand Central Station, suffered from declining foot traffic during Covid. The area houses major office buildings, and with so many people working from home in 2020 and 2021, the neighborhood came to a standstill. “Fifth Avenue lagged during Covid, and it wasn’t one of the first corridors to come back,” Taylor Reynolds, senior director in Cushman and Wakefield’s retail services division, told Modern Retail.

In fact, retailers started moving to the Upper East Side. In the second half of 2022, retailers including Hermés and Zadig & Voltaire opened 29 stores alongside Madison Avenue between East 57th and 86th Streets. As competition increased, though, retailers began the return to Midtown, particularly the blocks around Rockefeller Center.

“What we’re seeing as the world has started to come back is that there’s a focus from brands on what are widely considered the best blocks in New York City,” Jason Greenstone, executive director in Cushman and Wakefield’s retail division, told Modern Retail.

Fifth Avenue is the most expensive place for a retailer to operate, per Cushman and Wakefield. Yet, it has received an influx of interest from companies looking to expand. Last month, Chanel opened its first U.S. store dedicated to watches and fine jewelry in the Crown Building on Fifth Avenue. Last April, LVMH renovated the Tiffany & Co store known as The Landmark on Fifth Avenue. Burberry opened a new store on Fifth Avenue last summer.

Swarovski signed its lease on Fifth Avenue in early 2022 but opened its store in late 2023. A New York flagship was “a longstanding dream” for Swarovski, Kolja Kiofsky, Swarovski’s general manager of North America, told Modern Retail via email. “After meticulous consideration of various neighborhoods, we decided on Fifth Avenue, as it places the brand at the heart of luxury,” he said. The store has now been open for more than 100 days, he said, and it has a “very promising commercial outlook.”

Today, competition for space on Fifth Avenue is so tight that luxury retailers have started buying out their landlords to have a more permanent presence in the neighborhood. In December, Prada agreed to buy 724 Fifth Avenue, the home of its flagship boutique, as well as the building next door, for $835 million. In January, Kering (Gucci’s parent company) dropped $963 million to buy the retail portion of 715–717 Fifth Avenue, home to Dolce and Gabbana, which is relocating. LMVH is in talks to buy 745 Fifth Avenue, per Bloomberg.

Once they’re on Fifth Avenue, retailers are experimenting with new store designs, new light fixtures and new ways of organizing merchandise. The new Citizen watch store, for instance, includes a museum and an archive of historic watches on the second floor. The new Swarovski store has a grand staircase in the shape of an octagon and crystal doorknobs.

Opening a new store on Fifth Avenue requires “an incredibly high level of investment,” Greenstone told Modern Retail. “It’s been an interesting moment in time where brands are really looking and committing to the stores,” he said. “It’s an indicator that they believe so strongly in the street and in these locations that they’re acquiring these buildings, as opposed to renting them on a long-term basis.”

Redoing Rockefeller Center

Nearby, Rockefeller Center — which spans 22 acres in total — is reaping the rewards of a multimillion-dollar renovation started right before the pandemic. The area had long been a tourist spot thanks to its public art and art deco architecture, but “for a variety of reasons, Rockefeller Center was less relevant for New Yorkers,” EB Kelly, head of Rockefeller Center, explained to Modern Retail.

Rockefeller Center aimed to become a go-to destination for anyone looking to get a great meal, visit unique shops and have a quintessential New York City experience, Kelly said. Without those offerings, it feared it would be difficult to bring in more office workers, sway international and domestic visitors or “attract the kinds of brands that were growing and would want to come to Fifth Avenue,” Kelly said.

Thus came a complete reimagining of Rockefeller Center, including a new park on the roof of Radio City Music Hall and a lower-concourse redesign. Those projects were completed in 2021 and 2022, respectively, and Rockefeller Center is now “very pleased with the amount of interest [from retailers],” Kelly said.

The area is now home to some of New York City’s hottest restaurants, including Jupiter and Le Rock, as well as buzzy businesses like Alo Yoga, Todd Snyder and the bookstore McNally Jackson. Skims — long a target of Rockefeller Center, according to Kelly — and Corkcicle both ended up opening up pop-ups there in 2023. Catbird, a jewelry store known for its welded bracelets, came to Rockefeller Center in 2023, as well.

Rough Trade, an independent record store that makes a majority of its U.S. sales online, ended up moving its lone New York City store from Williamsburg to Rockefeller Center in 2021. “Unfortunately, Williamsburg hadn’t developed into the retail neighborhood we had first anticipated when deciding to open there back in 2009,” Stephen Godfroy, co-owner of Rough Trade, told Modern Retail. “To this day, it remains very much a nights and weekends area, lacking the footfall of Manhattan and also the level of public transport accessibility.”

Rough Trade had already considered moving to Manhattan pre-Covid but took the plunge when learning about Rockefeller Center’s revitalization plans. “Our move to Midtown is really us planting the counter-culture flag back in a neighborhood that has had it lacking for far too long,” Godfroy said. “What could be more indie, defiant, disruptive than subverting the expectation of where people think a record store like Rough Trade can be than opening in Rockefeller Center?” Today, the new store is so popular and centrally-located that “we’re selling many more records to many more people than ever before,” he said.

Hill House Home, a digital-first lifestyle brand that launched in 2016, opened a store in Rockefeller Center in 2022. Rockefeller Center was a “dream location,” Nell Diamond, founder and CEO of Hill House Home, told Modern Retail. “I have fond memories coming to Rockefeller Center as a child with my parents from London,” she added. Hill House Home, which also has stores in Nantucket and Palm Beach and is known for its “Nap Dress,” hosted a variety of holiday-themed events at its Rockefeller Center location this past November and December. Today, “foot traffic is incredible,” Diamond said.

On the other hand, fashion brand Kule didn’t have Midtown on its radar when deciding where to open a store, Jim Kuerschner, president of Kule, told Modern Retail. After meeting with Rockefeller Center’s owner Tishman Speyer, though, Kule changed its mind. “They pitched us successfully on the change that was happening, and they were really flexible with us,” Kuerschner said. “They could speak the language of a small brand in a way that a lot of other developers may not have been able to… We didn’t want to miss out on the opportunity.” Kule has two other locations today, one in Atlanta and one in the Brooklyn neighborhood of Cobble Hill.

Kule opened its Rockefeller Center store in 2021, and year-over-year sales in that location have been “really strong,” Kuerschner said. “Our average order value for a customer who shops both in store and online is 40% higher.” Kule has also embedded itself in the community, creating a sock exclusive to Rockefeller Center’s ice rink. “Our sock sales were out of control because people were always looking for a fun sock to wear with the skates or afterwards, so it was a really nice synergy for us,” he said.

Midtown has largely been viewed as a bit of a transient area — somewhere New Yorkers work during the day, only to return home — but that’s starting to change. The area is becoming more trendy and experimental, and retailers are vying for space they can snap up in the long run.

“I think people are excited about this proposition of making an investment in their space and being here and putting down roots,” Rockefeller Center’s Kelly said.