The economic clouds hovering over Europe are forcing companies to look at New York as a place to open stores to grow revenue, according to Manhattan brokers attending MAPIC, the global retail real estate conference held in Cannes, France this week.
Banking and employment troubles are creating an “urgency to open outside of Europe,” said Chase Welles, a partner with brokerage SCG Retail, speaking by cell phone from the show.
Some overseas retailers with stores in New York manufacture their own products, which allows them to pay a slightly higher price per square foot for space, he said. “That is one reason rents are being driven up [in New York],” he said.
MAPIC, which New Yorkers call the most important retail trade show overseas, is held each year in Cannes, and has more than 1,100 registered companies attending this week, according to its website. This year’s show began Wednesday and runs through Friday. It’s an influential market, although smaller than the annual International Council of Shopping Centers, held each year in Las Vegas, which last year attracted more than 33,000 attendees.
Retail industry executives such as Thor Equities CEO Joseph Sitt and brokers such as Sherri White, senior vice president at Vornado Realty Trust, and Gene Spiegelman, executive vice president at Cushman & Wakefield, attended the conference.
Some firms were notably absent, such as Brookfield Office Properties, which has a large retail project at World Financial Center coming online next year.
Many firms find this show can’t be missed. For example, Thor Equities is attending MAPIC for the fifth time. It showed off its Meatpacking District project, 837 Washington Street, on Thursday, after being selected by a MAPIC jury as one of 10 shopping center projects from around the world to be featured.
Thor Equities was one of the first New York retailers to take an interest in MAPIC, several brokers said.
“This is a very important show for us,” said Melissa Gliatta, executive vice president of Thor Equities. “We believe there is the kind of tenant [here] that we are looking for.”
While most attendees spend their time laying the groundwork for deals, SCG Retail broker Bertrand de Soultrait said he locked in a new client during the trip. He is now exclusively representing print retailer Carre d’artistes in the United States, which is looking to open three or four stores in Manhattan over the next several years, each about 1,000 square feet, he said.
Karen Bellantoni, an executive vice president at retail-focused RKF, said international retailers were eyeing New York for smaller spaces – for example, from 2,000 square feet to 5,000 square feet – with less demand coming from big box retailers wanting 20,000 square feet or more.
And despite the international doldrums, “New York is still an incredibly hot commodity,” she said, speaking by phone from the Intercontinental Carlton Cannes.