The more than two dozen chain and department store restructurings and closures announced this year have sent ripples across America. But while locals may be worried, New York City has not yet been too adversely affected.
During the past six months — while powerful brands like Nike, Victoria’s Secret and Foot Locker have grabbed NYC flagships and headlines — just as many other building owners were grumbling quietly about the lack of interest in their properties.
That has led to lower asking rents, “whisper” rents and even multimillion-dollar contributions towards renovations — something that store owners had previously declined to provide. “This is the most challenging [environment] that we’ve seen in two decades,” says Faith Hope Consolo, chairman of Douglas Ellliman Retail. “Even more than post-Lehman.”
That was back in 2008 and 2009, when Lehman Brothers went bankrupt and nearly all the banks were giving up prime corners spots. Needless to say, those vacancies were filled — but now there are other empty spots from Fifth and Madison avenues to Bleecker Street and from Soho to the Meatpacking District.
On the other hand, Robert K. Futterman of RKF, says, “The Flatiron [District] is a great market and one of the strongest in the city.” But as Futterman has said in the past, the building owners had leverage over the tenants; “Now,” he notes, ”they have to kiss the tenant’s tuchuses to keep them.”
Tourist-favored places are facing challenges as visitor numbers have dipped slightly for various economic reasons. But this year’s expected total of 61.8 million travelers — 13.1 million from other countries — is huge and not to be dismissed. Luring them here are bargains found citywide. “They can now get a better bang than they would have a month or two ago,” says Heidi Lerner, chief economist of Savills Studley.
“New York is now less expensive for international tourism.” But many of them may…