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www.crainsnewyork.com
Revolution moves to 26th Street
Socialist book store sets up shop in Chelsea
April 01, 2008 12:00 AM
Andrew Buck
New York Revolution Books, a 29-year-old independent bookstore that specializes in socialist subject matter, is moving to 150 West 26th St ., between Sixth and Seventh avenues.
The bookstore has signed a five-year lease for 1,400 square feet on the ground floor of the Chelsea condominium. The asking rent was $69 a square foot. The space includes a 1,000-square-foot basement.
The bookstore, which will move this month after it completes renovations, has been located at 9 W. 19th St. The landlord has sold the building. Aaron Gavios and Howard Aaron of Square Foot Realty represented the landlord, Chelsea North Retail. Glenn Teyf of CitySites Commercial Group represented the tenant.
Property Details
- Street Address : 150 West 26th St.
- Square Feet : 1,400
- Asking Rent : $69 Per Sq Ft.
- Lease Length : 5
- Market : Midtown South
- Submarket : Chelsea
- Borough : Manhattan
- Brokerage Firm : Square Foot Realty
- Author : Andrew Buck
- Landlord Broker : Aaron Gavios and Howard Aaron
- Tenant Broker : CitySites Commercial Group
- Tenant Broker Firm : Glenn Teyf
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The Real Deal
West 8th Street's retail woes
Empty storefronts dominate West Eighth Street, where the number of shoe shops continues to dwindle.
By Jen Benepe
Shop owners who still linger on the stretch of Eighth Street, once called the city's shoe capital, said the September 11 attacks ravaged the shopping district, which remains littered with empty storefronts. Since the collapse of the World Trade Center towers, 24 of 54 shoe stores have closed, a devastating percentage.
Today, 16 storefronts remain empty, giving the street a ghostly look and turning off potential new retailers. Other shops sport "Going Out of Business" and "70 Percent Off" signs. It's reeling, although shop owners, landlords and brokers say it's much more than a five-year terror hangover that's led to the area's decline.
The Eighth Street strip is an example of how market economics and changing fashion tastes converge and can upend a single street that once depended on shoppers from Brooklyn, the Bronx and Queens.
Rising rents played a role in the long march of Eight Street to decline -- rates doubled at some stores, putting veteran shopkeepers out of business. Some of the shuttered spaces have stayed vacant as long as two years while their owners wait for the area to come back, and the visual effect does little to dispel an aura of decay.
One shop owner, who is closing his shoe store after 20 years and declined to identify himself, said rent hikes were a citywide phenomenon, but also that "the easy money" landlords were seeking would cause the whole street to collapse.
"I feel bad, because this store was like home," he said, as boxes were hauled out of his storefront for the last time.
The rents are rising from an average of $50 a square foot per year to $80, $120 and $150, but are still way below the standard $200 to $350 per-square-foot prices in other parts of the Village and Soho, said Aaron Gavios, executive vice president at Square Foot Realty. His firm recently tried to rent out 21, 23 and 25 West Eighth Street, two of which have 1,500-square-foot spaces -- large for the street. But the landlord passed on the one good offer from Quizno's, a fast food franchise.
"The retailers walk the block, and they see all these vacant stores, and they think the plague hit it," said Howard Aaron, president of Square Foot. Other brokers passed on the shared listings and said the street was "finished," he noted.
A building superintendent for several properties on the block said drug dealers and panhandlers parked in front of Gray's Papaya on the corner of Sixth Avenue often urinated in store doorways, and harassed pedestrians, which adds to the seedy atmosphere.
He also pointed to a row of street vendors selling used magazines and incense in front of the old, unoccupied Sam Goody on Sixth Avenue. "Who wants," Aaron said, "to come here when it's like that?"
Alliance, shop owners at odds
Some shop owners point part of the blame at the direction their Business Improvement District, the Village Alliance, is taking.
One shoe store owner, who also requested anonymity for fear of being blackballed among brokers and by the Village Alliance, said he's been in the same location for more than 50 years, attracting customers from all over the world. "This was the capital of the world for shoes," he said. He said Honi Klein, the director of the BID, wants to steer the street away from shoe retailing.
Another shoe store manager at 55 West Eighth Street agreed: "The more shoe stores you have on Eighth Street, the more business you are going to have," he said, calling Klein's strategy "a mistake."
But some people involved in the area said they were glad to see the old retailers go. Critics said shoe retailers lack energy and a broad range of merchandise, and attracted low income, discount-seeking clientele, which they said contributed to the area's problems.
Klein said most of the old customers looking for shoes have moved on, especially to the retail area on 14th Street, where they shop at discounter DSW and other hot retailers. "The bottom line is that 14 new shoes stores between 16th Street and University [Place] have sprung up over the past seven years," said Klein.
"That's not the same customer and it's never been the same customer," countered the manager at Studio 55, which sells brands like Clarks, Dr. Martens, Ecco, Timberland, Dansko and Frye. His company has three stores on the street that he said are thriving, with both branded and private label goods, despite rising rents.
A newer strategy for the street
Nevertheless, Klein has moved forward with the strategy of catering to area residents, adding restaurants and making it a hub for ethnic dining options. The street now has a Belgian creperie, a Mexican cafeacute;, a Brazilian restaurant, a health food store and a pizzeria.
Broadway Panhandler, a large gourmet kitchen store, opened up in a large space across Sixth Avenue from Gray's Papaya, setting a new tone for the down-market discount strip.
"It evolved almost like magic," Klein said. Lower rents pulled the retailer away from Soho, where rents can hit $350 a square foot.
Eugene Warren, a principal with commercial landlord Buchbinder & Warren, which owns several buildings on the block, agreed with Klein. He said his firm now focuses on leasing to more expensive shops that will add ambiance and provide neighborhood services. They recently signed leases at 26, 28 and 30 West Eighth Street with a wine-tasting shop, a wine store and an art store. "When we have a vacancy now, we search for something varied and different," Warren said.
It's a formula that already worked at the edge of Union Square -- Buchbinder & Warren also owns the building that houses the Diesel store on Union Square South.
Bill Abramson, who handles leasing for Buchbinder, said that it made some improvements to the façdes and offered a slight reduction in the asking price of $150 per square foot to attract the right tenants.
The company would like to rent to businesses that cater to the many new residents that have recently invested in $600,000 studios and $1 million apartments nearby. Market players said they're not sure they can attract such retailers to Eighth Street in its present condition.
At Untitled, one of the few remaining high-fashion clothing boutiques on the street, owner Kevin Kelly said his brand-name products such as the colorful Ed Hardy hand-painted hats and T-shirts and Cedella Marley (Bob Marley's daughter) clothing line appeal to a steady clientele (including some celebrities), and he has been able to stay profitable.
After 20 years on the block, Kelly has a favorable long-term lease on his two-story, 4,000-square-foot store, and said he's made a point of keeping up with changes in fashion.
"Unfortunately, what happened in this neighborhood, some people were not selling interesting things and they weren't changing with the times," he noted.
That fact is obvious when walking the street. Some stores sell cotton clothing made in India, smoking paraphernalia, T-shirts, tarty Lycra dresses and belt buckles that evoke the 1970s. It's a nod to what made the area a hip shopping street back in the day, but it's out of date, said Klein.
Referring to the underserved family demographic in the area, where the neighboring park "is overflowing with children," Klein said, "those people are not buying T-shirts or having their bodies tattooed" -- other retail categories that she is asking landlords to avoid.
There are positive signs of change on the strip: eateries catering to increasingly upscale neighborhood tastes have done well. Le Pain Quotidien, at the corner of Fifth Avenue, is undergoing a third expansion. Crumbs, a bakery catering to children's parties, is also getting ready to open on the street, Klein added.
William Friedland, whose company owns the 14,000-square-foot former Sam Goody store at 398 Sixth Avenue, said he's close to signing a new national retail tenant, which would help banish the street vendors. He also plans to lease space at 16 West Eighth Street to a fashion, clothing or shoe retailer.
"Of course I would rent to a shoe store," he said. "I am a great fan of the clustering concept." |
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New York Post
LAND DOWN UNDER
PROPERTY BELOW 122 W. 34TH SELLS FOR $9.5M
July 16, 2008
Lois Weiss
Cuba's Caf which is part of the Chelsea Dining Group, is coming to Hell's Kitchen at a 900 foot space at 688 Tenth Ave., between 48th and 49th streets.
"It will be a high-style Cuban diner," said Aaron Gavios of Square Foot Realty, who repped the tenant and whose partner, Howard Aaron, worked for the building owner.
Just two years ago, Gavios said rents on Tenth were $40 a foot and now corners are fetching $150. "The corridor is changing overnight with a lot of luxury apartments and condominiums," he said. |
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The Real Deal
Eighth Avenue retail: More than porn meets the eye
Pornography shops like the Playpen may gradually disappear from Eighth Avenue.
November 2006
By Matthew Strozier
At first glance, it doesn't look like much has changed on the west side of Eighth Avenue near 44th Street. The stores there could be straight out of the gritty, crime-ridden 1970s Times Square: Stilettos, Peepworld and Play Pen. But this is only a temporary reality. A 256-unit, higher-end apartment building by developer Steve Witkoff is proposed for the site, and those retailers are more likely to be banks and drug stores in the future than porn shops.
In an ironic twist, porn shops on Eighth Avenue near Times Square may be a sign that the retail strip is actually getting better. At one time, porn shops moved to Times Square because it made business sense. Now, brokers say triple-X DVD stores are among the only operators taking spaces that may be demolished or gutted in a few years for luxury development. "Substantial retailers will not sign a lease with a demo clause," said Aaron Gavios, executive vice president with commercial firm Square Foot Realty.
In other spots, retail rents are rising faster than the avenue is changing, Gavios said, making it hard for independent operators but encouraging low-end but high-revenue businesses. "Rent is so high that, by being high, it is actually cheapening the type of retail that is there," he said. "It is having the reverse effect."
But Eighth Avenue may finally be starting to shed its sketchy past and enter the new world of Times Square. "I think it is getting better," Gavios said. "The seedy character is changing and there are less porn stores."
Eighth Avenue has historically been a place caught in the middle.
"Eighth Avenue has always been the quiet little child next to a loudmouth big brother on the east, and a precocious little brother to the west, which is Ninth Avenue," said Tim Tompkins, president of the Times Square Alliance.
Now Eighth Avenue is stepping out with major residential and office construction, and brokers also say the retail is not far behind.
Retail rents are $200 to $300 a square foot, and two huge new office buildings are planned directly across the street from the Port Authority Bus Terminal. The New York Times headquarters is expected to be completed in the summer with 24,000 square feet of retail on the ground floor. Next door, the former Milstein site is now being developed as a 40-story office tower by SJP Properties of New Jersey. To the north, at Eighth Avenue and 57th Street, the new architecturally ambitious headquarters building of the Hearst Corporation was recently completed.
Developer Forest City Ratner is looking to get food service in the Times building, either sit-down or to-go, that will be "refreshingly upscale" in light of what's nearby now, said MaryAnne Gilmartin, executive vice president and director of commercial and residential development for Forest City. Retail space is renting for $100 a square foot on the side streets to $125 a square foot on the avenue, well under the Times Square rates. But Gilmartin said the goal is to land the right tenant for the building that is prepared to invest in the site.
The Times Square Alliance is making a big effort to promote retail along Eighth Avenue. The alliance says there is $253 million in lost sales potential in Times Square because office workers and residents are heading to retail locations outside the area.
The alliance is working with owners and brokers to market the strip and improve the streetscape. Examples could include encouraging the typical T-shirt shop with 150-watt florescent light bulbs to have a more attractive façde.
Eighth Avenue does not have the pedestrian traffic of the "bowtie" intersection of streets in the middle of Times Square, but it gets plenty of visitors. Figures from the Times Square Alliance say that on a Wednesday night in July this summer, Eighth Avenue near 46th Street had 21,083 pedestrians. The same location on Broadway had 56,384 pedestrians.
Overall, Times Square has seen a huge increase in pedestrian traffic since the early 1980s. One block on Seventh Avenue near 42nd Street is projected to see a 367 percent increase in foot traffic by 2020. The city is taking steps to handle the pedestrian traffic. Under a new traffic plan announced last month, all traffic coming down Seventh Avenue will be diverted to Broadway, eliminating two lanes of traffic, and allowing for more space for pedestrians in the form of expanded center islands and sidewalks.
Although it won't be porn-shop row anymore, brokers and others say the future retail look of Eighth Avenue is still evolving. Joshua Strauss, managing director at Robert K. Futterman & Associates, said The Gap and Victoria's Secret are unlikely to plant roots, but he sees plenty of regional and other national retailers interested. FedEx and Kinko's, which RKF represents, want to open on Eighth Avenue, he said. "It doesn't take a visionary to see that the development is happening," he said.
The Times Square Alliance says that 5,000 new or soon-to-be completed apartments have gone up in Times Square since 2000, primarily on West 42nd Street.
Still, "it won't happen overnight," Strauss said. "Even though they can see that the block is changing and changing quickly, some retailers are scared because it hasn't happened yet. But it only takes a few pioneers and things change very quickly."
The Port Authority Bus Terminal has long been another detriment to the block, but the Port Authority is trying to change this. It signed a French bistro, Metromarche, to open on Eighth Avenue in the former site of the Silver Bullet Saloon. The broker on the lease, Carole Greene, a director at Newmark Knight Frank, said the rent was a bit below the market, but investment in the site was significant. "So it is a rent with a percentage over a natural break-point," she said. "It means that everyone is taking a risk here."
Other brokers say they are having no problem leasing retail spaces on Eighth Avenue. "As soon as it becomes available, it is getting leased," said Jeff Winick, CEO of Winick Realty Group who has worked on Eighth Avenue for 20 years. Most recently, Winick just leased a retail space on Eighth Avenue between 42nd and 43rd streets, although he said it was too early to provide details.
Many of the smaller restaurants are moving to Ninth Avenue for the more affordable rents, giving it the neighborhood feel instead of Eighth, said Gavios. "It's much more of a gamble and it's a gamble that some of the local proprietors are not going to take," he said.
Tompkins said he sees stores like American Apparel, Brooklyn Industries, Kiehl's and bookstores on Eighth Avenue.
"There is no doubt that there is a neighborhood retail that is needed," he said. "But it also has the potential to be destination retail for folks who can't afford the full freight of a flagship store in the heart of the bowtie." |
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