Manhattan retailers threatening to get out of Dodge if landlords don’t cut rent

Retailer wants Thor to lower its rent at 115 Mercer Street

TRD New York /
Feb.February 27, 2018 10:05 AM

115 Mercer Street and Joseph Sitt

Facing high costs and lower than expected profits, retailers on some of Manhattan’s most expensive thoroughfares are trying to get landlords to give them a break on rent.

For instance, the Kooples, a French clothing seller, is threatening to leave its space at Thor Equities’ 115 Mercer Street six years ahead of when its lease expires if the landlord doesn’t reduce the rent, Bloomberg reported.

“We were expecting much higher income,” Elodie Barbe, a spokesperson for the Kooples, told Bloomberg. “We are under discussions with the landlord to see what is possible.”

Property owners in Manhattan have increasingly granted rent reductions and inked short-term leases in a bid to avoid rampant store vacancies. According to Cushman & Wakefield, some 11,000 stores may close in the U.S. in 2018.

“Landlords are adjusting the way they do business to market conditions,” Patrick Smith, a vice chairman of the retail brokerage at Jones Lang LaSalle, said “It’s healthy. It certainly has stimulated activity.”

Last week, The Real Deal reported that Thor lost most of its interest in three retail-and-office properties due to unpaid debt to its joint-venture partner. It’s unclear if Thor will agree to lowering the Kooples rent, which is $650 per square foot for its space.

An analysis by TRD in 2017 found that retail sits vacant in nearly $1 billion worth of newly-bought Soho real estate, largely due to landlords holding out for tenants to pay near asking rents. [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

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”

ICSC’s annual New York show will feature twice as much programming as in years past.

Here’s what to expect at ICSC’s 2019 NYC event

Renderings of The William Vale and Denizen Bushwick with a Tel Aviv Stock Exchange ticker

All Year eyes sale of William Vale to pay off bonds

Target ads (right) seen on the corner of 42nd Street Eighth Avenue (Credit: Google Maps)

Target sets bullseye on Times Square with new lease

Breather CEO Bryan Murphy (Credit: LinkedIn and iStock)

Breather bloodbath: Flex-office startup fires 17% of staff

Stephen Levin, REBNY's Jim Whelan and Brad Lander (Credit: Getty Images)

The bill that won’t die: Will commercial rent control finally pass?

Federal Realty Investment Trust CEO Donald C. Wood and Georgetowne Shopping Center (Credit: Google Maps)

Fairway-anchored Bergen Beach shopping center sells for $85M

arrow_forward_ios