New York is Trend City.

Active, buoyant, very competitive, a continually changing heady game of musical chairs - in a nutshell this aptly describes the retail leasing scene for the first quarter of 1994. The whirl-wind of leasing activity, which began during the last quarter of 1993, is accelerating, resulting in fierce competition between retailers. Often no less than a dozen companies - both domestic and foreign - are vying for the same space. What follows is a closer look a what's taken place in this very active first quarter of 1994 - the harbinger of what I predict will become known a one of the best retail leasing years ever.

As has been well publicized, Superstore mania is on. Today's Man, Bed Bath and Beyond, Filene's, Barnes Noble, Staples all established Manhattan megastores, and are contemplating opening other locations within the City. The market is being driven by large retailers seeking to establish market share. Nowhere is the phenomenon more evident than lower Sixth Avenue, an area consisting of several category killer national and regional retailers. At the same time, their competitors are poised to enter the New York market. In the last three months, the new megastore entries include Channel, Bradlees, soon to be joined by Home Depot, K Mart and others. These big box users, these megastores, now have a firm foothold in Manhattan and with megaspace (30,000 to 50,000 square feet) in short supply, naturally the demand is high.

Another sector of growth continues to be the popular priced apparel industry. As pioneered by the Gap and Banana Republic, we now have Guess, Levi's, Contempo Casual, Clothestime, and A.B.S. Recently vacated bank space, much more of which is coming onto the market, is ideal for these types of users and landlords are delighted to accommodate them because they negotiate strong leases, have excellent reputations as tenants, and often look to expand on the premises and/or open new branches within a few years time.

Then you have the entertainment sector, the mega music retailers. Today's consumer wants and expects an entertainment shopping experience. HMV just completed a deal at the northeast corner of Fifth Avenue and 46th Street for 20,000 square feet. They also signed another deal for 30,000 square feet on the corner on 34th Street. In the meantime, Virgin Records is opening its superstore on Broadway in Times Square and Coconuts is actively seeking new locations all over the city. Tower Records is also on the move, having just opened their first Fifth Avenue location and under lease for two other units Uptown.

In the last three months, the luxury market selling "look good, feel good" products for both men and women has experienced a comeback. On Madison Avenue, foreign luxury retailers are locating in the States for the first time, and others, having been successful expanding. Prada, the Italian store for signature leather is expanding from 2,000 to 12,000 square feet. Chopard, a fine French jeweler, is taking their first US store. Stephan Kelian is tripling the size of their shop and will be joined on the Avenue by Betsy Boutique from Paris and Morgan LeFey. A new entry into the US market from Japan is Yumi Katura, a bridal courturiere. To boot, there are six other luxury retailers about to lease on Madison Avenue - three Italian, two French, one American. The action on Madison between 57th and 72nd Streets is exciting and intense.

That brings us to the Manhattan's famous Crossroads - 57th Street and Fifth Avenue. Very healthy indeed. Italian leather goods retailer Testoni will set up shop next door to St. Johns Knits on Fifth, only one block down from Bruno Magli and the new Nine West. On East 57th Street, Dana Buchanan, who specializes in inexpensive American designer clothes a la Ellen Tracy, is opening in the former Dunhill premises. Fifty-seventh Street is truly in a state of metamorphosis. With the maddening, crowds at Warner Bros. on the northeast corner of 57th and Fifth, with Levi's poised to move in next door, and Ann Taylor to move to the their new quarters later this year, 57th Street is a perfect example of a street where all price points can live together.

Park Avenue, continuing to bustle with activity, has established itself between 54th Street and 62nd as boutique row. Recent leases include the first-ever Jil Sander Boutique from Germany and Walter Steiger is moving to a triple sized store on Park from a smaller shop on Madison. Several antique stores are leasing space around Christies, including Nelson & Nelson, and at least two other deals are pending on the street as of the time of this writing. Although Park Avenue in the 50s and 60s was formerly considered very corporate and residential, it's filling in nicely with a wide variety of upscale boutique shops.

Shopping on Fifth Avenue below 42nd is experiencing a renaissance. With the debut on the northeast corner of 41st of the Body Shop, the area just north as well as south of Lord & Taylor's offers office shoppers more selection. Already home to Lechters, The Gap, Pier One, Comp USA, Athletes Foot and Barnes & Noble, there is opportunity for other megastores to debut here, with spaces ranging from 10,000 to 30,000 square feet still available. Anchored on the north by the main branch of the New York City Public Library and on the south by the Empire State Building, Fifth Avenue enjoys great tourist traffic en route Downtown.

Moving downward to Soho we have a prime example of a shopping corridor that has made a spectacular comeback. Twelve to eighteen months ago, there were many vacancies on Spring, Prince, Greene, and West Broadway and suddenly, at the beginning of this year, interest piqued from retailers desiring to expand downtown from upper Madison, namely Colours, Jenny G, and Madden Shoes. With almost no space left in Soho, the corridor has pushed over to Lower Broadway - LoBro. The main event in Soho for the first quarter of '94 is Buffalo France, a signature apparel group from Canada who will be opening their first American outlet on Prince Street next to Replay.

As for Manhattan's Upper East and West side residential areas, the service sector continues to grow with the new health and beauty aids shops such as Genovese, and popular coffee bars are still opening, spilling off onto Lexington and Columbus Avenues respectively. This is a direct function of the incredibly buoyant rental, co-op and condo market. One market feeds the other and everyone prospers.

In summary, retail in the 90s is all about choice. Manhattan, more than ever before, offers the kind of variety its residents, tourists and corporate clients require. Whatever you fancy - from a pot holder, to a book, to designer clothes - it's all available in New York and virtually on the same street. Now it's chic to shop at Bed Bath and Beyond with a pushcart when, formerly, the trendy thing to do was to shop at Hermes for a "kelly" bag. With the superstores, the popular priced clothiers, the hot new entertainment stores, the luxury boutiques, shopping has become, as the French say, a "divertissement" - an entertainment, a diversion from work, a pastime, a pleasure. Why? Because there is optimism in the air. We've weathered the recession, we've consolidated, we've saved and cut back on our spending, and now, as consumers, we're ready to experience the next buying cycle. And the retailers - the mom and pops, the regionals, the national and international players - all want to be in the Big Apple, realizing that if "they can make it here they can make it anywhere."

Consumers and retailers alike are becoming increasingly convinced that Mayor Giuliani has got the know-how and energy to truly turn this city around. Under his leadership, New York will reinvent itself once again. There's excitement and momentum and, above all, choice to the nth degree for the consumer. The landlords, too, will undoubtedly benefit due to the great race for space. And because of the incredible movement within the market, the shades of change and a new attitude, multitudes of opportunities abound for tenants as well. With rents again on the upswing, and with the influx of the regional retailers, I envision a spectacular 1994.