Despite continuing economic and consumer worries, there’s still plenty of demand for top-notch retail real estate in New York.
“Retail rents are now well above their all-time highs, approaching $3,000 per square foot on [upper] Fifth Avenue and $2,000 per square foot in Times Square,” said David Greenbaum, president of Vornado Realty Trust’s New York division, on a conference call detailing the company’s third-quarter results. “The [New York] retail market is very strong, driven by the continued growth in tourism, which is expected to reach 52 million visitors this year.”
Rents on Fifth Avenue from 42nd Street to 51st Street have almost doubled over the last year, said Greenbaum. Vornado has also seen retail strength on Madison Avenue and in Times Square.
And the high-cost stores that pack into these prime spots are not just show pieces, he said.
“Some of our retailers…approached sales per square foot of $6,000, $7,000 and $8,000 a foot on some small stores,” Greenbaum said. “I don’t think these things are just ‘advertisements and branding.’ I think companies today, and especially a number of the fast retailers that do their own production, these stores really are making money for them.”
Although Vornado has been trimming its portfolio as of late, it’s holding onto its investment in J.C. Penney Co. Inc. The company teamed up with activist investor William Ackman and amassed a combined 26 percent stake in the retailer in October 2010. The chain is now being reinvented as a specialty department store under the guidance of chief executive officer Ron Johnson.
Vornado’s adjusted funds from operations were basically flat at $744.4 million for the nine months ended Sept. 30, but the company has taken a hit on its Penney’s position. The real estate firm logged a mark-to-market loss of $53.3 million on its Penney’s holdings for the nine months.
Steven Roth, chairman of Vornado and a Penney’s board member, said, “This year, which is the transition year, is a difficult year [for the retailer]. It’s actually no secret that it’s proving out to be more difficult than the management team thought….We remain committed to the investment.”
Vornado beneficially controls 23.4 million shares of Penney’s, or 10.7 percent of the company’s stock. Shares of Penney’s slipped 2.3 percent to $23.70 Friday — down from the roughly $28 the stock was trading at before Vornado and Ackman’s initial investment was made public.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)