Retail’s busiest streets are booming with new investment, flagships
Investors and major retailers alike have shown significant confidence in North America’s high streets over the past year.
Sales transaction volume in high-traffic urban retail corridors in the U.S. and Canada increased 82% from 2024 to 2025, according to a new report from commercial real estate brokerage JLL. This is a signal of investors’ willingness to buy up high-end retail properties. The firm surveyed retail stakeholders across 40 urban retail corridors –distinguished by being nationally recognized and having national and international tenants — in eight U.S. markets and three in Canada.
This comes as major retailers have opened high-profile locations in places like New York’s SoHo, San Francisco’s Union Square or Miami’s Lincoln Road. Uniqlo, H&M, John Varvatos and Levain Bakery are among the tenants that have opened up along these streets the most over the past year. NYC, L.A. and Miami account for 60% of notable new store announcements in these corridors, according to JLL.
In some cases, trendy retailers are replacing vacant spaces left by traditional players. For example, in downtown San Francisco, Uniqlo is set to take over a former Old Navy flagship store next year. Uniqlo also leased space once occupied by J.Crew in Washington, D.C.’s Georgetown, Bisnow reported in October.
Many of the tenants opening flagships on these high streets are new to these kinds of neighborhoods or even to brick-and-mortar, in general. These are not necessarily high-end brands. Last year, San Francisco’s Union Square, for example, saw openings or announcements of stores from Nintendo, Zara, Uniqlo and Pop Mart.
“The landlords have said, … ‘It’s all about getting the highest-rent payer,’ and the highest rent payer is the one that gets the most velocity, much more footsteps — and that’s not what luxury is always going to get,” Naveen Jaggi, president of retail advisory services at JLL, told Modern Retail. “That’s where you’ll see transformation happening across all the major markets.” Additionally, McKinsey & Co. last year projected a slowdown in luxury goods sales through 2027 as price increases have turned away aspirational customers.
Jaggi said retail real estate investors have shown interest in high-foot-traffic corridors beyond New York, including Boston, Miami, Chicago, Toronto, Vancouver, San Francisco and Los Angeles. For example, a Dallas-based investor last year made a $42.2 million investment in a prominent seven-story retail and office building in San Francisco’s Union Square shopping district.
Retailers themselves have also been purchasing their own flagships to plant a flag in these neighborhoods long-term. Louis Vuitton, Rolex and Armani have all built or are building giant mixed-use properties in New York or Los Angeles, with Louis Vuitton’s purchases in Los Angeles’ Rodeo Drive topping $900 million.
Mass-market retailers have been purchasing their own real estate, as well. Ikea bought the former Nike flagship store building at 529 Broadway in SoHo for $213 million in September. And, near the end of 2024, Uniqlo paid $350 million to purchase a part of its flagship on Fifth Avenue.
Jaggi said retailers are investing in their buildings to protect their businesses in the long run as rents could increase as much as 50% over a decade. Asking rents along Madison Avenue grew 19% from 2024 to 2025, for example.
“When the cost of capital is what it is to the retailer, are they better off using it for occupancy costs or for investing in that building for 200 years?” Jaggi said. “By owning the building, you own your long-term success, because you’re not worried about occupancy costs as an impact on your overall sales.”
Additionally, digitally native brands have been leasing up space in these high-traffic districts, some for the first time. These includes Princess Polly, LoveShackFancy and Monos in SoHo, and clothing brand Frank & Eileen on Madison Avenue.
Rebekah Kondrat, managing partner of brick-and-mortar retail agency Rekon, said brands new to physical retail have become more confident over the last couple of years in signing 10-year leases for flagships in major corridors.
“There has been a belief that has returned to the retail ether that, for a first store, ‘We will open on Madison Avenue, and we will sign that 10-year lease,’” Kondrat said. “There’s not really a skittishness that existed even two years ago around signing a lease that’s longer than five years.”
These brands may not want 100,000-square-foot flagships, instead opting for maybe 5,000 square feet. The value they seek is not in size, but rather being in high-traffic locations, Kondrat said. “It’s about what the location does for the brand, from both the visibility standpoint and a customer engagement standpoint.”