Bergdorf Goodman. Tiffany & Company. Louis Vuitton. Fifth Avenue in Manhattan is to shopping what Broadway is to theater, defined by the marquee names that for decades have occupied some of New York City's most prized real estate.
But lately, the avenue's glittery window displays have been changing more quickly, as retailers have streamed in and out. Tourism has slowed while online shopping has sped up, making it harder for companies to justify the cavernous spaces and sky-high rents along the shopping strip.
On Tuesday, Ralph Lauren became the latest retailer to pull up stakes, announcing that it would close its flagship Polo store at Fifth Avenue and 55th Street as part of a previously announced effort to reorganize the company.
The move highlights how higher-end brands are not immune to the broader troubles facing brick-and-mortar retailers from online shopping and other competitors. Companies must often choose whether to invest in their online or physical stores — including showcase locations like those on Fifth Avenue.
"The Fifth Avenue model seemed to work for a while, and then it got to a point where it just doesn't work at this price anymore," said Barbara Denham, a senior economist at Reis, a real estate data and analytics firm. "It got to the point where I think landlords were jacking up each new lease with higher and higher rent, and at some point, something had to give."
Stores still line the avenue. But in recent years, a record number of brands along the upper part of the shopping strip have shuttered or relocated, including Kenneth Cole, Juicy Couture and H&M, according to an analysis from the brokerage firm Cushman & Wakefield. From 49th to 60th Streets, the availability rate of leases — one gauge of turnover — reached 15.9 percent at the end of last year, up from 6.1 percent five years earlier.
"I think brands are becoming more focused on driving sales and being realistic with what they need as far as the store size," said Robert Burke, a luxury consultant who worked as an executive at Ralph Lauren in the 1990s. "I think you can still set a brand image without having a huge store."
Across the country, once-mighty chains like Macy's and Sears have had to re-evaluate their physical locations. While the majority of shopping is still done in person, e-commerce has grown faster than brick-and-mortar sales. Department and big-box stores across the country have closed locations. Others have filed for bankruptcy, including American Apparel, Radio Shack and, on Tuesday, Payless.
Since the middle of 2015, major brands have shut down at least 470 locations at an accelerating pace, according to Ms. Denham. Those locations, represented in large part by Sports Authority, Macy's, J. C. Penney and Kmart, add up to about 28.9 million square feet of retail space, she said.