Squashing leasing rumors at 4 Times Square over Virgil’s BBQ

By Adam Fusfeld | October 06, 2011 06:44PM

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From left: 4 Times Square; John Grotto, senior leasing manager at Durst Organization, and Tom Bow, senior vice president of leasing at the Durst Organization; and a crowd shot at the Wednesday night’s event

There’s a rumor floating in real estate circles that the vacant retail space in 4 Times Square at the corner of 42nd Street and Broadway is accounted for. Last night, the Durst Organization held a party for brokers to show off the space, in part, to prove those rumors false.

“It’s frustrating when you reach out to a respected brokerage and you hear them say, ‘I thought that space was taken,'” John Grotto, senior leasing manager at the Durst Organization, told The Real Deal.

Durst Organization President Douglas Durst and more than 100 brokers were on hand to tour the 42,550-square-foot, three-floor space and enjoy ribs, brisket and mac and cheese from Virgil’s Real Barbecue — so much of it, in fact, that the restaurant was begging lingering brokers to take leftovers home.

It was the most action the space had seen since March, when the ESPN Zone bought its way out of a lease that was slated to run through 2014. The company is in the process of shutting down most ESPN Zone locations in the country.

The space, underneath the building Conde Nast currently calls home, officially hit the market at the ICSC event in Las Vegas in May, according to Tom Bow, senior vice president of leasing with the firm. The Durst Organization is seeking a 15-year lease.

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The floor of the ground-floor space at 4 Times Square still shows signs of its former tenant, ESPN Zone

The 4 Times Square retail area has a history of leasing confusion as old as the building itself. In 1999, a Gap concept store that included Old Navy was in talks to take the space, but negotiations lingered so long that the Durst Organization began calling the process “Old Maybe,” Bow told the attendees towards the end of the event. Finally, they backed out. ESPN took the space, but it was really interested in the building’s other retail location currently occupied by Nasdaq, which signed the paperwork just before ESPN could tour it. The sports media outlet was initially uninterested in the now-vacant space at 4 Times Square, but within a week reversed course and took it.

Now, Durst brokers say they believe it would work best for a flagship retail store. “The area has changed a lot since 1999,” Bow said to the attendees. “Back then the only shopping bags in the area were for the Gap across the street.” Today, Times Square is home to big-box clothing stores like American Eagle, Ann Taylor Loft and Quicksilver. Grotto noted that many restaurants have failed in the tourist destination that is Times Square, so retail and entertainment appear to be the ways to go. A tenant that has national and international recognition would make best use of the space he said, considering the exposure it guarantees.

If Durst can’t find a single tenant to take the entire space, it’s just as willing to split the floors up, which it believes would ultimately generate more revenue for the developer. The brokers declined to discuss approximate asking rents for the space.

“The pressure to find the right tenant is sincere,” Grotto admitted to The Real Deal, of marketing such a high-profile space. “But for me, it’s the opportunity of a lifetime… it’s almost like I have a hand in city planning.”