We Are Alive, Our City is Alive, Luxury Lives.

In the Spring of 2001, this report was still discussing the Millenium - the newness of it; how hard it was to get used to the 21st Century. The economy was moderating - no longer the boom of the year before - but, in light of the Federal Reserve continuing to lower rates, a returning expansion was certainly in the future.

Little did we know…

Now, three months into 2002, the Millenium seems old. It's as though all the elements of our day-to-day world had been put in a box and shaken and then, dumped out. They managed to return to their same positions, but everything is different.

It's been a little over six months since September 11th: During that time, we have remembered how good it is to be an American and how much can be lost in a matter of a few heartbeats.

We have a whole generation who had never known the tension and fear of being at war. Now, they know.

New York City, the Capital of the World, has a big hole in its side. It took the blow, stumbled, paused, caught its breath, and continued. Our country did the same.

The national economy took a dive. However, thanks to the American consumer, who never stopped consuming, it rallied. Now the new spin is that there never was a recession in the first place.

In New York, it will be tougher. Over 100,000 jobs were lost, largely in the securities and related financial services and many of the companies have shifted jobs to neighboring states. It is believed, though, that employers will return to the city, if they are offered tax incentives, among other things, to do so. American Express has already declared that it intends to come back, occupying the same building downtown as it did before the disaster.

National unemployment slid from 5.6 to 5.5 per cent in February, adding 66,000 jobs outside the farm sector. Retailers and manufacturersreport improvement and the housing market is strong -- even luxury housing is getting better -- according to The New York Times.

The city's transportation network is being rebuilt and the transportation infrastructure is returning more quickly than expected, which is a plus.Campaigns to bring back tourism to the city are proving successful.

As the clean-up finishes, and re-building begins, and the after shocks from the nonexistent recession gradually wane, employment will rise, business will continue to grow, we will achieve what has been called the "new normal" and go on from there.

Upper Fifth Avenue, Luxury Walk, continues its reclamation of glamour: after five years, the restoration of the Cartier landmark flagship at 52nd Street was completed. The gala reopening of the store presented a magnificence that is the perfect setting for the Cartier treasures - a true jewel box. Chicissmo is replacing Geoffrey Beene in the Sherry Netherland Hotel, 781 Fifth Avenue. Wempe Jewelers has expanded its glory at 700 Fifth, taking over the Tundra location next door. Donald Duck and Mickey Mouse are following in the footsteps of Bugs Bunny and departing 711 Fifth. It's so-long Disney, hello Dunhill - Alfred, that is. Salvatore Ferragamo is also expanding, to the northeast corner of 52nd Street. Blanc de Chine is planning a flagship to 673, northeast corner of 53rd Street.

The old Bugs Bunny haunt on the corner of 57th and Fifth has been purchased by Louis Vuitton. Across the Avenue, at 4 West 57th Street, Smythson of Bond St., the British stationer, has opened. The Liz Claiborne flagship store at 650 is under renovation. Cole Haan has taken over the Custom Shop at 620.

Pokemon Center has arrived at Rockefeller Center, facing the Plaza.

Fabulous Fifty-seventh Street, between Fifth and Madison is still one of the most expensive stretches of retail space in the world. On Fifty-seventh, between Madison and Park, Brioni for women is replacing Dana Buchman at the Four Seasons Hotel, joining Brioni for men on the other side of the Hotel

The desire for a retail location on Madison Avenue's Golden Mile hasn't diminished, in fact, it's probably increased, causing the Avenue to glow even more brightly, if possible, and grow even longer: there is another L'Occitane at 1288, between 91st and 92nd. The Body Shop is now at 1145 Madison, at 85th Street. On the corner is a brand new Coach. A block south, Petite Bateau is at 1094. Le Sportsac opened a boutique at 1063, between 80th and 81st Streets. Fauchon is at 1000. Sergio Rossi, at 835, expanded into the Maraola space next door. Lilli Blue is at 955. At 944, Morganthal Frederics has doubled its space. Jennifer Tyler Cashmere is now at 77th Street. At 850, there's a new two-level A Pea in the Pod. Ralph Lauren Home will be on the northwest corner of 71st Street, replacing Equipment. Searle is took Kenzo's place at 805. The Japanese tea shop, Itoen Kai, is where the Right Bank Restaurant used to be, next to the original MacKenzie Childs, 69th Street. Gucci will be between Cartier and Chloe, at the Westbury, 69th- 70th Streets. Akris has opened right across the Avenue, next to Prada. Rucoline is at 794, on the northwest corner of 67th Street.

Brequet took over the former Charles Jourdan location, 777. Fred Leighton, at the northeast corner of 66th Street, expanded to the next store. Jean-Paul Gaultier is at 759, between 65th and 66th Streets. Ilias LaLaounis has moved to 739. Giuseppe Zanotti opened its first U.S. boutique here, at 804, taking over from Peter Fox. Manfredi is now at 702. Chanel will have a brand new store for jewelry, accessories, and shoes in the very near future on the northeast corner of 64th Street. Charles Jourdan, has opened on the other side of FAO Schwarz. The northwest corner of 59th Street is now the home of DiModolo jewelers. Swarovski is opened its first store at 625. First Class Alviero Martini is at 609. Eredi Pisano is at 520. There is another Robert Marc at 488 and a J. Crew for men is opening at 347 right across from Brooks Brothers and just steps away from Ann Taylor, opening this summer.

That's just for starters…

Farther downtown and much closer to the destruction area, Super-chic Soho's retail took a beating. The tourist and out-of-town customer all but disappeared; sales really went down. There has been talk of Soho's losing its cachet. But the list of new tenants in the area certainly give lie to that:

On Spring Street: Puma opened the beginning of the year. MAC reopened at 113. Charles Jourdan is at 155; Medina Milano is at 151. Rucoline replaced Varda at 149 and Varda moved to 147. Burberry is now at 133. The Museum of Modern Art Design Store opened at 81 and Robert Danes is just off Spring, on Wooster. Faconnable is on the northeast corner of Spring and Mercer. Salvatore Ferragamo is on the corner of Greene and Spring Streets. Also on Greene, are Anya Hindmarch; Obzee, 125; Mont Blanc, 118; Hunting World, 116; Armani Casa, 97; La Perla, 93; and Agnes B. will be at 103. Helmut Lang opened his third store, in the former Wildenstein Gallery -- 142.

Red Flower is on Prince Street, as is Swiss Army Brands. Cartier is at 141 Prince Street. Lancel is the next store. Shiseido 5S is moving to 116; Francois Nars is taking their old place at 98. Ermenegildo Zegna is taking the old John Fluevog/Stussy location at 104.

Arche is now at 123 Wooster Street; BCBG Max Azria is new to 120. Barneys Co-op Store will take over the old Prada Sport location, 116 Wooster. Marthe and Francois Girbaud bought a single level building at 47.

Marni is opening on Mercer Street. The Marc Jacobs store at 163 Mercer, is now Marc. Nautica/Earl Jeans is on Mercer, at 160. Kors is at 159 and Maximus Spa Salon is at 15.

A fine jewelry boutique, Mizuki, has opened on Broome. There is a new Polo concept store on Mulberry.

Fiorucci returned to New York between Houston and Bleecker on Broadway. Crate & Barrel will have a duplex store at 611 Broadway. Prada opened its spectacular, not-to-be-believed store on Broadway at Prince Street. Hennes & Mauritz is now at 558 Broadway. Fossil is at 541. Bloomie's plans to be at 504, the present the home of Canal Jeans.

On West Broadway, there is Biche de Bere, 482. Tag Heuer has also taken a shop on West Broadway. Bodyhints lingerie is at 462. Robert March has opened at 436. Cerrutti Jeans is opening at 421 West Broadway. Anne Klein opened its first flagship store at 417 West Broadway, formerly Rene Lazard. Buffalo Chips will open at 355.

Otto Tootsie Plohound has a new store on Lafayette, near Prince.

What I have covered here are the three major areas of the city devoted to supplying luxury - the special things in life that aren't supposed to be essential for our well-being. Things we can do without. By what is listed above, one can see that perhaps people can do without, but they would really rather not. The wonderful, beautiful things provided on the Luxury Walk, Golden Mile, and in Super-Chic Soho are part of what makes life worth living -- they too are necessary. We are alive, our City is alive, Luxury lives.

Faith Hope Consolo
Chairman, Retail Leasing & Sales Division
Prudential Douglas Elliman
Tel: 212-418-2020 / Fax: 212-418-2005
e-mail: fconsolo@elliman.com