News from ICSC: MAC cosmetics inks pricey lease in Union Square
Also: Sol Goldman estate signs CrossFit lease, CVS takes UES space, Related expects $1.5B in sales at Hudson Yards
The cosmetics company MAC signed a new 15-year lease for a portion of the ground floor in the Feil Organization’s 853 Broadway, fronting on Union Square South. One person familiar with the deal said would it be a record rent for the park area.
MAC, represented by Robert Cohen of RKF, inked the lease last week, taking 1,600 square feet on the ground floor and a small piece of mezzanine space, a source close to the transaction said. MAC previously signed a then-record $2,700 per foot rent on Upper Fifth Avenue at 689 Fifth Avenue in 2012.
Fast-fashion retailer H&M was expected to take multiple floors in the building, but that deal collapsed last year. Now with office prices strong in the area, the second and third floors may be rented for that use, instead of as retail as planned under the H&M concept, insiders said.
Feil marketing material displayed at the ICSC’s RECon 2014, running through tomorrow, shows about 16,616 square feet available as retail in the building, including 4,180 square feet on the ground floor. The asking rent was not immediately available.
MAC did not immediately respond to a request for comment. The Feil Organization and RKF declined to comment.
Meanwhile, in the Grand Central area, Brick NY CrossFit signed a long-term deal for 1,200 square feet of the ground floor, 3,000 square feet on the second floor and 9,000 square feet on the lower level at 465 Lexington Avenue, a five-story building owned by the estate of Sol Goldman, located between 45th and 46th streets. The deal was signed about three weeks ago.
Sources said the Goldman estate was asking about $35,000 per month for the space. The final lease terms were not available. Brett Weinblatt represented the landlord in-house, while the tenant was represented by Jonathan Travis of Ripco Real Estate.
The space had been vacant, and a number of tenants were looking at it, Weinblatt told The Real Deal. They decided on the CrossFit company because, “we felt it was the best use for the building and the neighborhood.
Farther uptown, drug store retailer CVS signed a deal for 10,000 square feet on the ground floor and 7,000 square feet on the lower level, at 1172 Third Avenue, in space that had been formerly occupied by the bankrupt women’s clothing chain Coldwater Creek. The asking rent for the Upper East Side location was “north of $300 per foot,” one source said.
CVS will occupy the bulk of the space, but is putting 2,300 square feet of the ground floor space on the sublease market. Brands such as Nike and Reebok have recently agreed to deals in the vicinity.
CVS was represented by Newmark Grubb Knight Frank’s Jason Pruger and the building was represented by Jonathan West of Charles H. Greenthal Group.
And while these deals were done in existing spaces, Related Companies is optimistic its mega-development at Hudson Yards will become one of the top performing retail shopping malls in the country.
The 750,000 square feet of retail coming on line first at Related’s Hudson Yards is expected to generate about $2,000 per square foot, or a total of $1.5 billion, annually by 2018, Kenneth Himmel, president and CEO of Related Urban, told TRD.
Robert Futterman, CEO of RKF, speaking with TRD at his firm’s booth at the ICSC this morning, said he was “blown away,” by the Hudson Yards presentation.
Of the $2,000 per foot expectation, he said, “that is a bold projection, but anything can happen.”
Himmel, for his part, said the Hudson Yards project was distinct from two other huge retail projects underway: Brookfield Office Properties’ Brookfield Place, which is undergoing a $250 million upgrade to modernize the retail at the 1980s-era buildings; and the World Trade Center retail, which will be the shopping heart of a major transportation hub.
“This is custom-crafted retail,” Himmel said. “It’s not a retrofit or layered into transportation.”