The Real Deal New York

H&M suing JEMB over facade construction of Herald Center

Retailer seeking $11M in damages, cites "funhouse" exterior

May 08, 2015 03:20PM
By Rey Mashayekhi

Renderings of H&M's flagship Herald Center store at 1293 Broadway

Renderings of H&M’s flagship Herald Center store at 1293 Broadway

On the same day that it announced the May 20 grand opening of its new flagship store at Herald Center, Swedish retail giant H&M sued the landlord of the store for more than $11 million, claiming that work on the property’s façade left the storefront with “funhouse” mirrors and a design contrary to the lease agreement.

H&M filed suit Thursday against Herald Center, owned by Downtown-based JEMB Realty, claiming the landlord “did not seek H&M’s permission to change the design” of the store’s façade and constructed a building exterior “not substantially similar” to renderings presented to H&M.

Exterior work for the 63,000-square-foot location at 1293 Broadway, which H&M is planning to open on May 20, was slated for completion in mid-December. But the retailer says the renovations are not up to par with its original plans and is seeking $41,000 for each day in the delay of the work’s completion – more than $4.6 million to date.

H&M also claims it was required to pay more than $4 million to repair the “defective work” at the premises, as well as more than $2 million to accelerate completion of the repairs in time for the grand opening this month, bringing total damages sought to over $11 million.

The retailer agreed to take four floors at Herald Center in 2013. JEMB Realty announced a $50 million facelift for the building earlier that year. The landlord agreed to contribute $12 million to renovation work at the property as part of H&M’s lease, according to the lawsuit.

Neither H&M legal representatives nor JEMB Realty returned requests for comment.