Though the weakness of the retail market has been a national story for some time, the drop in Manhattan retail rents as a result of those struggles is somewhat startling.

Rents remain on the decline in Manhattan, despite the recent uptick in demand these lower rates have spurred. Concessions have become the norm across multiple sectors of commercial real estate, but according to a study from CBRE as reported by the Commercial Observer, they are affecting the value of retail spaces drastically.

Though average asking rents have declined in Manhattan by 2.7% year-over-year, what tenants pay is considerably less, as restrictions on financing for landlords prevent them from lowering the raw price of a space. Instead, concessions have dropped the average net effective rent 20 or 30 percentage points from the 2014 peak.

Meanwhile, cap rates are down to 3% to 4% on average in the borough, which means there remains a disconnect between the price of space for landlords and the amount of money they can extract from their tenants.