NEW YORK — Just two years ago, the prognosis for retailing in SoHo seemed uncertain.
The iconic lower Manhattan neighborhood gained fame for its funky art galleries and residential lofts in the Eighties, which morphed into commercial activity in the Nineties. But there were hard times after the Sept. 11 terrorist attack on the nearby World Trade Center and recovery was challenging.
Although the opening of Bloomingdale's on Broadway in 2003 generated traffic on that shopping thoroughfare, "For Rent" signs abounded on side streets such as Spring and Wooster.
But that was then. Now, with an influx of international tenants, SoHo has regained its business vibrance. There is that elusive element called buzz.
The neighborhood is a United Nations of cultures and colors. Spanish designer Angela Ruiz de la Prada's exuberantly colored banner flutters above 35 Wooster Street, and the Canadian chain Parasuco has a cavernous store in a former bank on Spring Street showcasing sexy jeans. Paris-based Kiki de Montparnasse's boutique at 79 Greene Street combines upscale lingerie with erotic objects, British designer Alice Temperley occupies a second-floor loft on Broome Street, and Marni's charming designs beckon from a futuristic space at 116 Mercer Street.
M Missoni and Reiss have planted flags on West Broadway, Tokyo's A Bathing Ape opened at 91 Greene Street, and Morgane Le Fay's sells her romantic designs from a Wooster Street boutique. These are just some of the foreign names that have ventured into the area.
"Post-Sept. 11, there was a glut of space, and that lasted a few years," said Beth Greenwald, a retail broker at Newmark Knight Frank. "Interior SoHo suffered the most. Now there's a different roster of players."
The district has turned the corner in the last 12 months, broker Joel Isaacs said.
"Retailers are focusing a lot of attention on SoHo now...early in 2006 there was still a lot of space available," he said.
Interest is being generated by reports that retailers such as Intermix at 98 Prince Street, which sells international designers like Stella McCartney, Karl Lagerfeld and McQ by Alexander McQueen, are doing strong business. "They hear that buzz," said Karen Bellantoni, a broker at Robert K. Futterman Associates. "They want to get into that action, too."Names heretofore unknown to most New Yorkers will be opening outposts in SoHo. Karen Millen recently signed a lease on Prince Street. The mid-priced brand from the U.K. has a flagship on Regent Street in London and operates more than 100 stores worldwide.
Korres Natural Products, a Greek manufacturer of skin, body and hair care products with herbal extracts, has launched at 150 Spring Street.
More recognizable will be Sir Paul Smith, who purchased 142-144 Greene Street, where he is building a multilevel store. Smith is known for applying quirky touches to classic styles.
Still on tap is Mango, the Barcelona-based fast fashion chain, which has negotiated a lease for an 8,000-square-foot space at 561 Broadway. The deal is dependent on Kate's Paperie, which occupies the space, moving to Spring Street between Lafayette and Cosby Streets, a person close to the deal said. Mango opened its first MNG by Mango store in the U.S. at South Coast Plaza in Costa Mesa, Calif., in May.
As early as 2004, reports began circulating that Mango was seeking a site in SoHo. The company was said to be interested in a space directly across from Bloomingdale's, however the deal never came to fruition. "The Mango lease [at 561 Broadway] got signed, but Kate's has term left on its lease," Bellantoni said. "They're actively looking in Manhattan and SoHo. This is an important location for them."
SoHo has always appealed to the international set. Comme des Garçons designer Rei Kawakubo, who arrived in 1983, was one of the first retailers in the neighborhood. She catered to the art community until 1998, when she moved to Chelsea, along with an early wave of art dealers.
Yohji Yamamoto arrived in 1998. He expanded and redesigned his store at 103 Grand Street two years ago to accommodate his three labels, Yohji Yamamoto, Y's and Y-3, a collaboration with Adidas. Yamamoto, who recently signed a lease on Gansevoort Street in the Meatpacking District for a collection store, may eventually convert his Grand Street space into a Y-3 boutique after the Meatpacking unit opens.
A spokeswoman for Yamamoto said the designer was initially attracted to SoHo "because it was filled with artist studios and lofts. When we introduced Y's and Y-3 on Grand Street, that brought us a younger and more diverse clientele. Now it's definitely more tourist-oriented. We get more passers-by who don't necessarily know Yohji."Some tenants are more interested in commerce than art.
Uniqlo, which on Nov. 10 will unveil a 36,000-square-foot world flagship at 546 Broadway, has embarked on an aggressive publicity campaign to trumpet the opening. The Japanese retailer specializes in low-price luxury basics such as cashmere sweaters for women at $49.50 and up; jeans start at $39.50. The fact that Uniqlo chose SoHo over other locations bodes well for the neighborhood's future, real estate brokers said.
The boundaries for fashion in SoHo are expanding southward.
"While everybody says that fashion tenants in SoHo want to be on Greene Street or Wooster Street between Prince and Spring Streets, I now see retail expanding to Grand Street," said Lisa Rosenthal, a broker at Ripco Real Estate Corp.
Rents have rebounded as well. At the height of the market in 2000 and most of 2001, asking prices for prime retail space notched up to $300 to $350 a square foot. In 2003, the asking price for space on Broadway was $160 a square foot, according to the Real Estate Board of New York. By fall 2005, asking rent for Broadway, between Houston and Broome Streets, rose 27 percent to $228 per square foot, compared with the same period the previous year.
"Rents are healthy," Bellantoni said. She cited asking prices of $275 per square foot to $400 per square foot on Broadway; $300 per square foot on Spring and Prince Streets, $225 on Greene Street and $200 to $250 on West Broadway.
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