Riese sells 560 Fifth Avenue for $38M to Japanese coffee vendor

Japanese coffee company Geshary is bringing a caffeine buzz to Fifth Avenue’s shopping corridor with its purchase of a boutique building at 560 Fifth Avenue for $2,800 per square foot.

The $38 million sale by the Riese Organization closed last week. It was the priciest deal for an entire Fifth Avenue retail building since the start of the pandemic, according to Colliers.

The brokerage’s Zach Redding and Dylan Kane represented the Riese Organization, which held the building for 50 years and owns and operates many chain restaurant locations in New York City. A CBRE team led by Daniel Kaplan repped the buyer, which plans to occupy the property.

“This transaction demonstrates that Upper Fifth Avenue continues to be viewed as a safe haven for long-term investment regardless of current market conditions,” said Colliers’ Redding.

Buyers who occupy a building tend to pay a premium because they benefit from not needing to pay rent. “Investors are driven by returns,” said Redding. “Users are looking at a building as a place where they can do their plan without paying rent to anyone.”

The 13,580-square-foot property includes 24,500 square feet of air rights and has 125 feet of frontage on Fifth Avenue and West 46th Street, where sunglass maker Oakley has had a store for 10 years; the retailer’s lease ends in March 2024.

This is not the first time Riese has sold to a Japanese buyer. In 2021, Japanese confectioner Minamoto Kitchoan bought 604 Fifth Ave for $45 million, or about $2,500 per square foot.

Geshary’s multi-story cafe in Tokyo, where each floor represents a stage in the coffee production process, may provide a model for its Fifth Avenue location, where patrons taking pit stops on the fashion circuit can fuel up on high-end espressos.

Years after the pandemic accelerated customer demand toward online delivery, luxury retailers are pouring money back into brick and mortar locations on Fifth Avenue.

Rolex is building its largest store ever at 655 Fifth Avenue, across the street from Geshary’s new building, and Tiffany & Co. spent $250 million to renovate its 100,000 square-foot flagship on Fifth Avenue and East 57th Street. Louis Vuitton is knocking down two buildings to create an elaborate flagship store and Chanel has leased its first space on Fifth Avenue.

Riese has also tapped Colliers to sell 34 Union Square East, a two-story retail property once operated as a co-working space, and a TGI Fridays before that, for $16 million. Prospective buyers include condo developers seeking views of Union Square Park and 26,000 square feet of development rights.

The Riese Organization, credited for the concept of the food court, made its mark by blanketing Manhattan with fast-food franchises, including many Dunkin’ Donuts.

Rich Bockmann contributed reporting.

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