The Real Deal New York

Nike in late-stage talks for FAO Schwarz space at GM Building: sources

Retailer would relocate from Trump-controlled 6 East 57th Street

April 06, 2016 07:24PM
By Rich Bockmann

The General Motors Building and the Niketown store at 6 East 57th Street

The General Motors Building and the Niketown store at 6 East 57th Street

Nike is lacing up for a move to the former FAO Schwarz space at the General Motors Building.

The retailer, whose flagship Niketown store sits just about a block away on East 57th Street, is in late-stage negotiations to lease the prime retail space adjacent to Apple’s iconic cube, sources told The Real Deal.

It’s unclear whether Nike is eyeing the entirety or a portion of the 61,000 square-foot space, which includes about 13,000 square feet on the ground floor with the remainder split among a lower level, mezzanine and roughly 34,000 square-foot second floor.

Cushman and Wakefield’s Joanne Podell is representing Nike, sources said, while her colleague David Green is negotiating on behalf of the landlord, a partnership of Boston Properties, Chinese property mogul Zhang Xin, and the Safra banking family. Both brokers declined to comment. Representatives for Boston Properties couldn’t be reached.

The iconic toy store FAO Schwarz started looking to get out of the pricy location on the 58th Street side of the building at 767 Fifth Avenue in 2013, when it placed it space on the sublease market.

As late as April of last year, FAO Schwarz’s parent company Toys “R” Us was reportedly considering renewing the lease, which runs through 2017. But citing rising rents, the toy conglomerate decided not to renew, and Boston Properties executives said they would work with FAO to “expedite” its exit.

In July, FAO closed its doors after nearly 30 years at the location. Toys “R” Us, which closed its Times Square flagship store, was negotiating in August to open a co-branded store with FAO Schwarz at the Brill Building.

Nike has been looking to get out of its space at 6 East 57th Street, which is controlled by Donald Trump, since 2013. The company had been negotiating to take the former H&M space at 640 Fifth Avenue. Victoria’s Secret inked a deal at the location earlier this year for some 64,000 square feet.

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