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NEW YORK — Fifth Avenue is about to get some big-name tenants — Sean John and Zara.
Sean “P. Diddy” Combs is poised to enter retailing, with his first Sean John store expected to open on Fifth Avenue and 41st Street, WWD has learned. The Sean John shop will help bridge the large fashion gap between Saks Fifth Avenue at 49th Street and Lord & Taylor at 38th Street.
Real estate sources also said Zara will move into the Faconnable location on Fifth and 54th Street, when Façonnable, which is owned by Nordstrom, relocates to Rockefeller Center this summer. Zara already has four stores in Manhattan, in SoHo; on 59th Street and Lexington Avenue; on Fifth Avenue and 17th Street, and on West 34th Street between Fifth and Sixth Avenues. In addition, Apple, which also has a store in SoHo, is said to be eyeing midtown Fifth.
According to sources, Sean John is taking a 3,800-square-foot space, but no lease has been signed yet. Negotiations are in advanced stages, though the company has been talking to multiple landlords who have available properties on 41st Street and Fifth Avenue. One site, which seems to be the front-runner, is on the southeast corner of Fifth and 41st, while another site is between East 41st and 42nd Streets. If a deal is announced soon, it’s possible the store will be up and running for the Christmas season.
“I know he’s been negotiating with a couple of landlords,” said a source familiar with the situation. Another source said that P. Diddy wants to launch a women’s collection, which will help fill any retail space he takes. He did feature women’s apparel on the runway in February. Currently, Sean Jean offers men’s and children’s wear.
In some ways, it’s a curious move for P. Diddy. While Fifth Avenue between 49th and 38th Streets is a high traffic area, it’s a virtual dead zone for fashion, with only a handful of apparel shops operating along the stretch, including Ann Taylor, Barami, Fossil, Forman’s and The New York Look. Otherwise, it’s a hodgepodge of B-level retailers selling computers, cell phones, cheap souvenirs and fast food catering to office workers and tourists.
However, there is plenty of opportunity for fashion firms, or even discounters, to break in. Among the biggest Fifth Avenue locations available are Today’s Man on the southeast corner of 44th Street, the Wiz on the southeast corner of 46th Street, and the HMV site at 46th Street, where a lease is said to be coming due, though it’s possible HMV will renew. In addition, the Charles Scribner building between 48th and 49th Streets is reportedly being marketed. It currently houses Benetton’s Sisley division.
There are many more “space available” signs on Fifth Avenue, particularly in the 40s.
Generally, fashion brands seeking a Fifth Avenue site for a retail flagship search north of Saks, which is between 49th and 50th Streets. But it’s tough to find space there, and availability, even in these challenging economic times, remains slim.
So far, there has only been minimal fashion migration south, but there is a sense it could pick up owing to the lack of availability to the north. Lacoste is opening this summer on the southwest corner of 49th Street, and United Colors of Benetton about two months ago opened adjacent to the Scribner building. American Girl is taking the former Korean Airlines space just south of Saks.
Sean John’s entry could spark greater interest in the corridor, currently rife with vacancies and lease deals. Sources said Fifth Avenue sites north of 49th might soon be available, reflecting the economic times. Among them, Hugo Boss at 717 Fifth Avenue, may be available once its AOL Time Warner Center store opens. The Disney Store also could undergo some downsizing.
“There are plenty of opportunities for retailers to seize a presence on Fifth Avenue at reasonable rents,” said Richard Hodos, president of Madison HGCD retail real estate brokers. Rents range from $160 to $200 a square foot from 37th to 47th Streets, while rents go for around $300 a square foot from 47th to 49th Streets, Hodos said.
“On the other hand, it remains a question mark whether upscale shoppers will venture below 49th Street,” he added.
Still, wherever P. Diddy goes, the crowds follow, and based on the wide acceptance of his Sean John line at department stores, his foray into retailing is likely to go well beyond Fifth Avenue, possibly to such places as Beverly Hills and Miami. P. Diddy has a retail team in place, headed by Charles Soriano, director of retail. Soriano declined to talk about the Fifth Avenue store.
“Sean John is a very big resource at Bloomingdale’s,” said Kal Ruttenstein, senior vice president of fashion direction at the retailer. “It started as an inner-city resource, but it’s developed into a very sophisticated line. It appeals to all people — suburban, inner-city — with casual looks, pull-on pants, zipper jackets, in velours and cotton knits and [fur-trimmed] hooded parkas.” Ruttenstein said the line is better priced, ranging from $68 to $400.
In addition, a new luxury residential high rise is going up opposite Lord & Taylor, which will have some retail space available, and should help fuel retail sales.
Despite the turnover of space, between 34th and 49th, “things are immeasurably better than they were 15 years ago,” said Tom Cusick, president of the Fifth Avenue Association. He said back then, the retail scene was a lot shadier, with many more going-out-of-business signs, and many more street vendors and stores selling tourist rip-off items and fake antiques, and overflowing trash receptacles.
“It used to be a total nightmare,” however local business improvement districts, combined with legislation and zoning regulations, have elevated the quality of life along Fifth Avenue. “In general, there has been a steady upgrade of stores on Fifth Avenue for the last seven or eight years, and we are beginning to see movement going down south of Saks because there isn’t as much space turnover north of Saks.”