Ralph Lauren is subleasing its Fifth Avenue location for just a fraction of the price.
Mango, the Spanish fast-fashion retail chain, has agreed to take on the 28,300-square-foot store at 711 Fifth Avenue on the corner of East 55th Street, Business Insider reported.
Under the deal, Mango will pay $5 million annually, less than 20 percent of the more than $27 million per year that Ralph Lauren pays to occupy the prime piece of real estate.
Asking rents across Manhattan’s 16 main shopping corridors fell 12.8 percent from a year ago to $659 per square foot in the third quarter, according to a CBRE report. That’s 4.2 percent below the second quarter and the lowest level since the back half of 2011.
“Ground floor rents on Fifth Avenue used to be more than $3,000 per square foot—in some cases a lot more—but today there’s a growing sense that taking rents are more like one-third of that, in some cases even less,” CBRE vice chairman Richard Hodos told BI.
Parts of the city that rely on tourist foot traffic have been hit especially hard. In Times Square, there’s been an 18 percent decrease in average asking rents, from $1,820 per square foot to $1,492 per square foot year over year. Foot traffic in the area was down by 72 percent as of October, according to data from the Times Square Alliance.
Michael Shvo and Turkish real estate mogul Serdar Bilgili purchased 711 Fifth Avenue from Wafra Capital Partners for $937 million in September 2019. Wafra had purchased the tower from its namesake, Coca-Cola, for $909 million a month earlier. The sale marked one of the largest flips of a New York building in recent memory.
[BI] — Sasha Jones