he year before that, the top deal was Nike’s $35 million lease at 650 Fifth Avenue, while in 2015, the top lease was watchmaker Swatch Group’s $35 million lease at the St. Regis on Fifth Avenue.
Put another way, the top 10 retail leases for 2018 totaled $62 million, compared with $71 million in 2017 and an eye-popping $150 million in 2015.
TRD communicated with more than 20 real estate professionals to determine the top 10 deals and the estimated annual rent. The rents are approximate and no figures were confirmed by sources on the record. Renewal deals were not included.
And there were other indications of a muted 2018, including the relatively large number of relocations within the top 10, as opposed to new entries to the market or expanding brands.
“We are not seeing the $20 million to $30 million rents being paid for showcase stores. The reality is that it’s difficult to carry a rent of that magnitude [now],” Robin Abrams, a broker with Compass, said.
She said the relocations underscored that firms with experience in New York were the ones prepared to sign large leases. And she took that as a positive sign of stability for the city.
“Tenants that have an existing presence in the market and are relocating — in many cases to larger more pricey real estate — and continue to operate in a challenging real estate market — that is not bad news,” Abrams said.
And despite the lower figures, brokers are seeing strong activity at the close of the year, said Karen Bellantoni, a broker at RKF. She expected to see many deals close in the first quarter of 2019.
“We are doing a ton of transactions, although maybe not as big as a few years ago,” Bellantoni said. She was optimistic, in part because she s seen long lines to get into experiential stores. And that online retailers continue to open brick and mortar stores.
“It’s now very clear that the web business can’t stand on its own. They need stores to support it,” she said.
1) Tenant: McDonald’s
Rent: $11.5 million Address: 1530 Broadway, Times Square Landlord: Charles Moss’ Bow Tie Properties
McDonald’s signed the most valuable retail lease in the city, paying approximately $11.5 million per year at its new location in Times Square, at 1530 Broadway. The tenant is paying about $8.9 million per year for the retail space and the balance of the rent payment is for a large sign.
The quick service restaurant will take 4,000 square feet on the ground floor and 3,000 on the second floor.
Colliers International’s Brad Mendelson and David Green, Nicole Mendelson and Tommy Botsaris represented the landlord Charlie Moss and his Bow Tie Properties, while Cushman Wakefield’s Andrew Kahn and Christian Stanton represented the restaurant.
McDonald’s will vacate its store at 1560 Broadway where it was paying under $5 million, in a space controlled by SL Green Realty and Jeff Sutton’s Wharton Properties.
2) Tenant: Puma
Rent: $8.9 million Address: 609 Fifth Avenue, Midtown Landlord: SL Green Realty, Jeff Sutton’s Wharton Properties
German shoe and athletic apparel company Puma signed the second most valuable lease of the year at 609 Fifth Avenue, the former home of American Girl. Puma is taking approximately 24,000 square feet in the building, and paying $8.9 million as a starting rent in the 15-year deal. The retailers will occupy a portion of the basement, the first floor and the entire second floor.
JLL’s Robert Gibson and Greg Covey represented the tenant, while Cushman Wakefield’s Steven Soutendijk represented the owners.
3) Tenant: Tiffany Company
Rent: $8 million Address: 6 East 57th Street, Plaza District Sublandlord: SL Green Realty, Jeff Sutton’s Wharton Properties
Tiffany Company took a short-term, three-year sublease at 6 East 57th Street, the former home to athletic retailer Nike. The 181-year-old jeweler will pay approximately $8 million per year, insiders said. The jeweler will occupy the 73,350-square-foot space while its flagship location next door at 727 Fifth Avenue undergoes a renovation reported to cost an estimated $250 million.
Nike vacated the 57th Street location earlier this year to relocate to a 69,000-square-foot, seven-story retail space at 650 Fifth Avenue controlled by SL Green and Jeff Sutton. Nike signed a lease in 2016 for the space with a starting annual rent of $35 million, making it the most expensive deal signed that year.
The Trump Organization controls 6 East 57th Street through a long-term lease, but SL Green and Sutton agreed as part of Nike’s complex Fifth Avenue transaction, to pay the remaining term of the 57th Street lease, which extends through to mid-2022, at a rate of about $13 million per year, insiders said. The Tiffany’s deal will now provide the partnership with sublease payments through the end of the lease term.
CBRE s Andrew Goldberg and Annette Healey represented Tiffany’s, while RKF s Ross Berkowitz, Tyler King, Ariel Schuster and Jason Wecker represented SL Green and Sutton.
4) Tenant: Celine
Rent: $8 million Address: 650 Madison Avenue, Plaza District Landlord: Vornado Realty Trust, Crown Acqusitions
Women’s fashion designer Celine signed a deal for 5,000 square feet at Vornado Realty Trust and Crown Acquisitions’ 650 Madison Avenue, paying an estimated $7.8 million in an annual rent. The deal also includes 800 square feet of additional storage space.
The deal was direct, with Vornado and Crown negotiating with the tenant for the space with no brokers, insiders said.
Celine, currently at 870 Madison Avenue, is one of several tenants on the avenue to relocate this year. The other high-end one is Balenciaga, which landed as number six on this ranking, taking space on the next block south at 620 Madison Avenue.
The Celine lease terms penciled out to roughly $1,300 per square foot, compared with Balenciaga’s lease at under $1,000 per square foot. Insiders pointed out that 650 Madison has extremely high 22-foot ceilings and is also one of the few buildings on the pricey stretch of Madison Avenue that is not subject to Landmarks Preservation Commission regulations. Because of that, Celine has greater freedom to brand the facade with its name, whereas Balenciaga and most Madison Avenue tenants are restricted in the kind of signage they can employ.
5) Tenant: Coty
Rent: $6 million Address: 719 Seventh Avenue, Times Square Landlord: SL Green Realty
Cosmetics manufacturer Coty inked a lease for its Cover Girl brand at 719 Seventh Avenue in Times Square, paying an estimated $6 million per year. The 10-year deal covers 10,040 square feet for the entire four-story building located at the corner of 48th Street. In addition to the retail, the lease also came with 5,800 square feet of LED billboards.
JLL’s Michael Hirschfeld represented Coty, while RKF’s Ariel Schuster, Ross Berkowitz, Mitch Heifetz and Jason Wecker represented the landlord SL Green.
6) Tenant: Balenciaga
Rent: $5 million Address: 620 Madison Avenue, Plaza District Landlord: Boston Properties
Fashion brand Balenciaga signed a lease at 620 Madison Avenue, paying an estimated $5 million in annual rent. The
新上海贵族宝贝论坛 landlord, Boston Properties, was represented by Cushman Wakefield and Colliers International. Balenciaga was represented by Isaacs and Company.
7) Tenant: Forever 21
Rent: $4.3 million Address: 435 Seventh Avenue, Penn Plaza Landlord: Vornado Realty Trust
Fast-fashion retailer Forever 21 signed a five-year deal to take former H M space at 435 Seventh Avenue in the Penn Plaza district. The tenant will be paying landlord Vornado an estimated $4.3 million per year for the 43,000-square-foot space, located at the corner of 34th Street across from Macy’s.
Cushman Wakefield agents Jason Greenstone, Michael O’Neill and Taylor Reynolds represented the retailer.
8) Tenant: Target
Rent: $3.85 million Address: 1865 Broadway, Lincoln Square Landlord: AvalonBay Communities
Target, one of the few big box retailers to sign multiple big deals this year, is paying an estimated $3.85 million in annual rent for a 35,601 space at AvalonBay Communities’ 1865 Broadway in the Lincoln Square neighborhood. The space is in the base
新上海贵族宝贝论坛 of AvalonBay’s under-construction, 172-unit condominium and rental tower, that includes 70,000 square feet of retail at the base.
Ripco Real Estate’s Richard Skulnik represented Target, while JLL’s Patrick Smith, Matt Ogle, Corey Zolcinski and Erin Grace represented the landlord.
9) Tenant: Peloton
Rent: $3.4 million Address: 450 West 33rd Street, Hudson Yards Landlord: Brookfield Property Partners
Illustrating the influence of the fitness industry, the ninth most valuable lease was Peloton signing a deal for 26,000 square feet at 450 West 33rd Street, the Brookfield Property Partners rehabilitated office building in Hudson Yards. The studio gym chain that also has an online presence is paying approximately $3.4 million per year for the space. The landlord was represented by JLL and Peloton was represented by Newmark Knight Frank.
10) Tenant: Ralph Russo
Rent: $2.85 million Address: 680 Madison Avenue, Plaza District Landlord: Thor Equities
British fashion designer Ralph Russo inked a 15-year lease with an estimated annual rent of $2.85 million at Thor Equities’ 680 Madison Avenue on the Upper East Side. It’s the company’s first store in New York City
The lease, for 5,800 square feet of space, has 2,300 on the ground floor and 3,500 square feet on the second floor.
The landlord was represented in-house by Sam Polese, Albert Dayan and Alexandra Frangos, while David Baker of Isaacs and Company represented Ralph Russo.
The top 10 NYC retail leases by annual rent
3 (tie)Tiffany and Company$8,000,0006 East 57th StreetPlaza DistrictWharton Properties; SL Green Realty 3 (tie)Celine$8,000,000650 Madison AvenuePlaza DistrictVornado Realty Trust; Crown Acquistions We are having some 爱上海 technical difficulties. Try again later.