Kaden Realty Market Report Q2 2025

2025

Q2 MARKET ASSESSMENT

PREPARED BY

KADEN REALTY, INC.

info@kaden.nyc

www.kaden.nyc

One World Trade Center Ste 8500 New York, NY 10007 KADEN

RESTAURANT LEASING UPDATE Mid-Year Market Snapshot | Hospitality-Focused Insights

Prime Manhattan restaurant corridors (West Village, SoHo, Flatiron) remain slightly below 2019 peak rents, but momentum is building

Key Market Trends

• Prime Manhattan restaurant corridors (West Village, SoHo, Flatiron) remain slightly below 2019
peak rents, but momentum is building
• Retail availability is shrinking, especially for vented and turnkey restaurant spaces
• Neighborhood corridors in Brooklyn (Williamsburg, Bushwick, Bed-Stuy) and Queens (Astoria,
Ridgewood) are driving F&B growth
• As a result, greater lease flexibility and discounts to the asking rents are said to be applied across
many deals

Opportunity Zone
• West Village: Strong legacy tenant activity, rare second-gen space
• Bushwick: Top submarket for chef-driven concepts and hybrid models
• 5th Ave (Midtown): $350M streetscape overhaul to boost foot traffic & appeal
• Greenpoint/Ridgewood: Balanced price and exposure with rising demand

Why Lease Now:
• Core F&B corridors are leasing up and prime inventory is disappearing

Opportunities for Investors & Restaurant Owners

Referencing the chart below, one can see that retail/hospitality commercial leases in Murray Hillare priced at a 30% discount to those in Manhattan. On the flip side, residential real estate pricesare up ~12% YoY in the neighborhood according to Redfin. Given that residents in theneighborhood have increasing purchasing power and that restaurants are priced at a discount,now is an opportunistic time for investors to back operators.
Retail/hospitality commercial rents are marked 92% higher than that of all listings in Manhattan,indicating that it may be a keen time for a restaurant owner to sell at a high multiple
Hospitality brands expanding in 2025 are locking in 5-10 year leases at a market discount
NYC’s recovery is outpacing national trends: tourism, office return, and residential constructionall fueling demand
Landlords are still negotiating, especially on term length and tenant improvements (TIs)

Superior Terms for Nightclub to Fine Dining Renovations

In 2020, Up & Down Night Club closed and reopened just two months ago as Supper Club, a
French-American restaurant & cocktail lounge

Current owners Victor & Dustin Drai secured a $10 per square foot rent reduction at 244 W 14th
St in Chelsea, negotiating the rate down from $64 RSF to $54 RSF as shown on the graph above

IT'S A NEW HORIZON

Operators who embrace strategic decision-making—whether through tax planning, conversions, or optimized leasing—will be the ones who thrive.

1. What do I need to know to unlock Tax & Zoning Benefits? Maximize conversions with tax breaks, abatements, and regulatory advantages.
2. How do I ‘Convert Smart, Lease Smart’? Structure conversions to optimize leasing terms and long-term revenue.

3. Would it hurt to capitalize on Brooklyn & Queens Growth? Invest where demand is surging and rental rates remain strong.

4.What’s my Greatest Obtainable Market Q1&2? Maximize Market Share. Target the most profitable segment—20% of the obtainable market.

Kaden brings deep market knowledge and expertise to complex transactions, addressing all landlord challenges under one roof.

Unique Ways we see the Business

Kaden's Unique Integrated Solution

Experience in Similar Markets

Strategies for 2025 and Beyond

Bledar Asllani

(212) 729 3526
bledar@kaden.nyc

Benjamin Woods

(917) 808 9495
ben@kaden.nyc

Kaden Realty, Inc.

One World Trade Center Ste 8500 New York, NY 10007
www.kaden.nyc info@kaden.nyc

Source 1: CoStar (2025, June). New York City Retail Market
Source 2: Page Six (2025). Drai’s brining supper club to NYC that serves $1k caviar
Source 3: CoStar (2025)