The Daily Dirt: This Soho building is vacant, but it’s also 100% leased

An analysis of New York's top real estate news

Jan.January 21, 2020 01:00 PM
An aerial and street view of 600 Broadway (Credit: Google Maps)

An aerial and street view of 600 Broadway (Credit: Google Maps)

A retail building in Soho is vacant. But the absentee tenants are still paying rent.

The six-story building at 600 Broadway, formerly Hollister’s flagship store, is vacant but paradoxically 100 percent leased, Kevin Sun reports. Hollister’s parent, Abercrombie & Fitch, must pay the rent through the end of its lease (2028).

The owners, Aurora Capital Associates, A&H Acquisitions and Crown Acquisitions, are trying to modify the terms of a loan on the property in order to prematurely end another active lease. 24-Hour Fitness, which left the property in 2018, has a lease for 30,279 square feet through 2023. According to Kroll Bond Rating Agency, the building owners have a replacement tenant lined up.

Of course, most ground-floor retail is technically illegal in Soho. In fact, 600 Broadway was one of several stores slapped with violations in 2018 for occupying larger space than allowed under Soho’s current zoning. That might give prospective tenants pause about committing to the space. While efforts to rezone the neighborhood to allow for more retail and residential use have gained momentum in the past year, a formal process for making such changes has yet to take off.

More luxury contracts were inked in Manhattan last week than the previous one. Don’t get excited.

Last week saw 15 contracts above $4 million — four more signed than the previous week, according to the Olshan Luxury Market Report. But for a little context: 2020 so far doesn’t seem much worse or better than 2019. In other words, this year is also off to a sluggish start.

“At this point, we have 34 contracts signed [in 2020], and last year we had 37,” said Donna Olshan, who authors the report. “It’s not that much different.”

The most expensive contract was for a unit at One57, also known as the first of the Billionaires’ Row towers. The condo was listed for $21 million in October 2018 and went into contract last week with an asking price of $16.5 million.

According to the report, the average price discount between first and final asking price was 17 percent. Four properties with asking prices above $10 million had an average price cut of 28 percent.

What we’re thinking about: Thank you to all who responded to Friday’s question. The consensus so far seems to be that readers would like to either receive the newsletter earlier in the evening or early the following morning. Topic wise, is there anything you’d like to see more of? If so, send a note to [email protected].

Programming note: City offices were closed Monday in observance of Martin Luther King Jr. Day. Check back Tuesday for top closings, residential listings and new building filings.

A thing we’ve learned…

For roughly a week, Queens native Awkwafina is the voice of the 7 train — as a promotion for her new Comedy Central show “Awkwafina is Nora from Queens.” When announcing the train’s arrival at Hudson Yards, Awkwafina quips: “Hope you like weird architecture!” Thank you to Kevin Sun, who provided this dispatch.

Elsewhere in New York

— Executives of MTA contractor WRS Environmental Services are facing fraud and other charges for allegedly bribing an MTA official to steer work worth more than $10 million to their firm, Gothamist reports.

— Bronx Sen. Luis Sepulveda is facing scrutiny for a $200,000 loan he received from a Long Island dentist, the New York Post reports. Dr. Efraim Zak provided the loan, at 4 percent interest, in July 2017 to help pay for his special election to the Senate in April 2018.

— Gov. Andrew Cuomo announced Monday that he will pledge another $10 million to the state’s census count efforts, bringing the total investment to $70 million. He also noted that Martin Luther King III, along with celebrities Lin-Manuel Miranda and Lucy Liu, will serve as honorary members of the state’s census council.

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