Barneys plans to give up space at its Madison Avenue flagship

Retailer's rent at Ben Ashkenazy's 660 Madison is $30M a year

TRD New York /
Mar.March 28, 2019 08:40 AM

Barneys at 660 Madison Avenue (Credit: Google)

UPDATED, April 2, 11:45 a.m.: Following a significant rent hike, Barneys New York plans to shrink its flagship Manhattan store by more than half.

The department store owner is in talks to let go of up to five of the nine floors the store occupies at 660 Madison Avenue, the New York Post reported. The move is an effort to cut back on Barneys’ $30 million in annual rent.

Executives have floated giving up floors five through nine and possibly some ground floor space, the report said. “It’s clear that the space is too big,” a person familiar with the negotiations told the Post.

Barneys would join other retailers in pulling back on flagship Manhattan storefront space thanks to soaring rents and shifts in the retail market. Lord & Taylor closed its Fifth Avenue store this year as part of a sale to the We Company, while Henri Bendel and Tommy Hilfiger also shuttered. Calvin Klein is also slated to close its 18,000-square-foot flagship on Madison Avenue.

Barneys refuted the report.

“Barneys New York is committed to maintaining the footprint of its Madison Avenue flagship, and continuing to serve its customers within this iconic store,” a company spokesperson told The Real Deal. “There are no active conversations regarding the store’s footprint, and all statements indicating otherwise are false.”

Freds Madison Avenue, the restaurant on the eighth floor of Barneys — which attracts regulars including Bruce Springsteen, Laura Bush and Hugh Grant — will stay open, according to the Post.

The landlord, Ben Ashkenazy’s Ashkenazy Acquisition Corp., is considering taking back some floors and converting them to office space or luxury apartments, a source said.

Last year, a city arbitrator ended the lengthy rent dispute between Barneys and the landlord, declaring the retailer’s new annual bill to be $30 million. The move doubled the store’s rent.

The company signed a new 10-year lease in January, which raised the store costs to an annual $44 million, including property taxes.

In addition to the 275-000-square-foot Manhattan location, Barneys has 22 locations across the country, including two smaller locations in New York. [NYP] — Meenal Vamburkar


Related Articles

arrow_forward_ios
J.C. Penney at the Westfield South Shore mall in Long Island and  J.C. Penney CEO Jill Soltau (Google Maps; Getty)

J.C. Penney to keep Bay Shore outpost open for now

J.C. Penney to keep Bay Shore outpost open for now
Signature Bank CEO Joseph DePaolo and New York Community Bank CEO Joseph Ficalora (Photos via Getty; Facebook; iStock)

NYC’s multifamily lenders see shares tumble in 2020

NYC’s multifamily lenders see shares tumble in 2020
The analysis predicts that office vacancies across the world will continue upward (iStock)

Report: Office market won’t return to glory until 2025

Report: Office market won’t return to glory until 2025
Korean wave pours into U.S. commercial real estate

Korean wave pours into U.S. commercial real estate

Korean wave pours into U.S. commercial real estate
The Martinique hotel (Wikipedia, Google Maps)

Operator of Martinique Hotel in Manhattan files for bankruptcy

Operator of Martinique Hotel in Manhattan files for bankruptcy
CEO Mark Tritton and 410 East 61st Street (Getty, Google Maps)

Bed Bath & Beyond will permanently close UES store

Bed Bath & Beyond will permanently close UES store
A rendering of 556 West 22nd Street (Photo by BASIS Independent Schools)

Private school to expand in former Chelsea Art Museum building

Private school to expand in former Chelsea Art Museum building
With about $23 billion of hotel-related CMBS loans in forbearance, more lenders are looking to offload those mortgages. (iStock)

Hotel industry is in trouble and more lenders want out

Hotel industry is in trouble and more lenders want out
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...