UPDATED, 9:57 a.m., June 6: Acadia Realty Trust, the White Plains, N.Y.-based retail real estate investment trust co-developing the City Point mega-project in Brooklyn, found a tenant for the second portion of the now-vacant Barnes & Noble space in the Flatiron District, the developer told The Real Deal.
A spinoff of Open Kitchen, a café and gourmet food market in the Financial District, signed a 10-year lease for 22,000 square feet at 5-7 East 17th Street near Fifth Avenue. Urban Fare will occupy two levels – 10,500 square foot on the ground floor and 11,500 square foot on the second floor. Owner William Kim intends to offer more fresh food and make it more upscale than Open Kitchen, said Christopher Conlon, executive vice president and chief operating officer at Acadia.
Open Kitchen opened last August at the William Beaver House, the 47-story luxury condominium-turned-rental building at 15 William Street. At first, the market was open 24 hours a day, but now it shuts its doors at midnight. Urban Fare will sit at the base of two Property Markets Group-developed condo buildings.
“We worked with the condo board to comply with their expectations,” Conlon told The Real Deal. “Their concerns about trash, vermin and noise were allayed.”
The market-rate asking rent in the area ranges from $100 to $150 per square foot for retail space, and rent for the lower level of this space is closer to $150 per square foot, sources said.
The Barnes & Noble store at 17th Street and Fifth Avenue closed in January as its lease expired. That same month, Midtown South-based property ownership firm the Bromley Companies signed clothing store chain Banana Republic for 28,000 square foot at 105 Fifth Avenue – the portion of the former bookstore space that Bromley owned, as The Real Deal reported. The remaining 22,000 square feet belonged to Acadia.
Jon Krieger, managing director at retail brokerage RKF, represented the tenant in the deal, while Conlon represented the landlord in-house. Neither Kim nor RKF could be immediately reached for comment.
As the Barnes & Noble lease was expiring, several local restaurateurs and specialty fitness and apparel companies approached Acadia about the space.
The market is expected to open by summer 2015, after about six to nine months of renovations. The construction of the Urban Fare space will come with “large buildout costs,” much of which Kim is shouldering, Conlon said.
“He’s investing his money, and we’re investing our trust,” Conlon said. “And that’s a good match.”