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.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews