Manhattan retail landlords now offering big tenant giveaways to avoid cutting rents

SL Green, Jeff Sutton, for instance, offered to take over Nike's Trump Tower lease to get $700M deal at 650 Fifth done

TRD NEW YORK /
Mar.March 28, 2017 09:06 AM

Facing rising retail vacancies, Manhattan landlords are offering perks like paying for renovations and moving expenses to lure tenants.

Instead of slashing asking rents, landlords are finding other ways to sweeten retail deals, Bloomberg reported. For example, SL Green Realty and Jeff Sutton offered to takeover Nike’s lease at Trump Tower to make way for its $700 million deal at 650 Fifth Avenue.

“That deal did not come easy by any stretch,” Andrew Mathias, president of SL Green, said of the Nike deal during an investor conference.

And Thor Equities TRData LogoTINY, which has a number of vacancies across its retail portfolio, gave fashion designer Tom Ford a $12 million “improvement allowance” when he signed a 12,300-square-foot lease at 650 Madison Avenue.

Rents have been on the rise, especially on Fifth Avenue between 49th and 60th streets, where they jumped 50 percent in the past five years, according to Cushman & Wakefield. The availability rate along Fifth Avenue — the most expensive stretch of retail real estate in the world — jumped to 15.9 percent in the fourth quarter of 2016, rising from 10.1 percent the previous year. In the third quarter, average asking rent swelled to $3,213 per square foot and then dropped at the end of the year to $2,985. [Bloomberg] Kathryn Brenzel 


Related Articles

arrow_forward_ios
Clockwise from top left: 312 West 34th Street, 61 North 9th Street, 639 Classon Avenue, and One Fulton Square (Credit: Google Maps)

These were the top 10 NYC retail leases in July

Ricky's at 830 Broadway (Credit: NYC Go)

Ricky’s, iconic NYC beauty shop, faces
more closures

From top, clockwise: Cushman & Wakefield's Joanne Podell, Showfields' Amir Zwickel, Appear Here's Josh Yentob, Brookfield Properties's Mark Kostic (Credit: Getty, LinkedIn)

When it comes to retail, “real estate in New York is fundamentally broken”

Absent federal assistance, landlords and real estate developers are at the mercy of their lenders. (Credit: iStock)

Landlords locked out of $350B Paycheck Protection Program

(Illustration by Daniel Castro Maia)

Why real estate is still tangled up with the mob

Paul Massey’s B6 Real Estate hit with layoffs

Paul Massey’s B6 Real Estate hit with layoffs

Judge Janet DiFiore and Judge Rowan Wilson (Credit: iStock, New York State Courts)

High court decision has tenants stewing, landlords oohing

Sharif El-Gamal (Photo by Desiree Navarro/WireImage)

WATCH: Developer Sharif El-Gamal has Covid-19. But he’s one of the lucky ones

arrow_forward_ios
Loading...