UPDATED, 10:44 p.m., June 8: Fast fashion-clothing chain Express is the latest fashion retailer looking to get out of its lease on Times Square’s pricey “bow tie” shopping strip where Broadway meets Seventh Avenue, sources told The Real Deal.
Express is reportedly paying $20 million per year – one of the largest rents in the neighborhood – for the 30,000-square-foot space it leased at 1552 Broadway back in 2013.
Now, nearly three full years into the 15-year lease, the retailer has struck a deal with landlords SL Green Realty and Jeff Sutton, allowing them to market the lease. If they find a new tenant, they will terminate the Express lease and sign a new one, according to a source with knowledge of the talks.
The landlords are representing themselves and have not hired an outside broker.
If the landlords can’t find a new tenant who will pay more than Express — yet Express still wants to leave — the parties would likely negotiate some kind of financial transaction under which the clothing retailer would exit the space.
Representatives for Express, SL Green and Wharton could not be reached for comment.
Express inked the deal at a time when retail rents across the city, and particularly in Times Square, were rising precipitously. But the market has recently cooled, and many tenants feel they are in a stronger position to negotiate with owners than they were over the past year.
Last month, rival retailer Aeropostale announced its plans to shutter its 19,000-square-foot store one block south on the opposite side of Seventh Avenue at 1515 Broadway after filing for bankruptcy, according to Crain’s, which first reported that Express was rumored to be looking to leave the space.
Correction: An earlier version of the story gave the wrong address for Aeropostale.