May 14 (Bloomberg) -- Luxury retail strips from Manhattan’s Fifth Avenue to London’s Bond Street and the Avenue des Champs Elysees in Paris recorded lower rents in the first quarter as the global recession cut sales, Colliers International said.

The average rent on Fifth Avenue, the world’s most expensive retail corridor, dropped 15 percent to $1,400 ($1,027 euros) a square foot from the same period a year ago, the Boston-based property broker said today. Rents on New York’s Madison Avenue fell 32 percent to $750 a square foot; Prices on the Champs Elysees dropped 41 percent to $859 and on Bond Street they plummeted 48 percent to $726.

“The real question for retailers is whether improving consumer confidence will translate into increased consumer spending,” Colliers said in the report. “This has not happened yet, nor do we expect it to for some time.”

Retail sales in the U.S. and the U.K. fell in two out of the three months on the first quarter, according to Bloomberg data. Confidence among U.S. consumers reached its lowest level in February since the Conference Board began measuring sentiment in 1967. The Confidence Index was 25.3 in February and rose slightly in March to 26, the group said on March 31.The index rose more than forecast in April to a five-month high of 39.2.

Surviving 2009

“Survival will be the name of the game in 2009, and even for stronger players, the emphasis will shift from store openings and expansion to streamlining operations,” Pat Duffy, chairman of Colliers Retail Services Group, said in a statement.

Los Angeles’ Rodeo Drive saw rents drop 26 percent to $400 per square foot, Colliers said. In San Francisco, Union Square retail rents were also $400 a square foot, an 18 percent drop.

Rents are declining on Fifth and Madison Avenues in New York but not as dramatically as Colliers reports, said Faith Hope Consolo, chairman of Prudential Douglas Elliman’s retail real state division and a broker who negotiates leases on those strips.

First quarter leases Consolo brokered on Fifth Avenue had rent declines of no more than 5 percent and Madison Avenue leases dropped no more than 20 percent, she said.

Rental concessions have increased, Consolo said. Owners are granting longer leases of 15 to 20 years and offering up to eight months free while tenants move in and renovate.

F.P. Journe, a watchmaker, signed a lease space last month at 721 Madison Ave. for $1,000 per square foot, Consolo said.

This year “is about everybody looking for a bargain-- whether it’s a shoe, a handbag or store, everybody wants it on sale,” Consolo said. “So Madison’s on sale.”

To contact the reporter on this story: Oshrat Carmiel in New York at ocarmiel1@bloomberg.net.

Last Updated: May 14, 2009 14:28 EDT