There’s been an evolution occurring along Manhattan’s Madison Avenue for the last couple of years. Along with an influx of contemporary retailers priced lower than the street’s traditional designer fare, fashion brands are pushing the limits of Madison Avenue upwards, beyond 72nd Street.
This story first appeared in the November 26, 2013 issue of WWD. Subscribe Today.
The most sought-after corridor of the thoroughfare continues to be between 60th and 72nd Streets. In the last two years, contemporary brands like Rebecca Taylor, Vince, Alice + Olivia, Theory and Rag & Bone have positioned themselves on that stretch of Madison.
Now, international brands in need of recognition are flocking to locations in the heart of the prime area, Madison Avenue between 60th and 64th Streets. Paule Ka, a French brand with 475 points of sale, including 58 freestanding stores, is opening its first U.S. unit at 723 Madison Avenue between 63rd and 64th Streets.
“They need the brand recognition,” said Dan Harroch, who with Matt Seigel, both brokers at Thor Retail Advisors, represented Paule Ka in the transaction. “The address is so attractive and critical. It’s a real U.S. expansion. They want to be in Florida, and California’s important. They have big plans for the U.S. if they’re successful in this location.”
Other newcomers that have settled in the same vicinity include Kent & Curwen, Frey Wille and Schutz. Vince Camuto opened its first collection store at 667 Madison Avenue, on the corner of 61st Street.
Of course, these prime locations command premium rents of $1,700 to $2,000 a square foot, Harroch said, adding, “It’s a strong market and there’s not much available.”
That’s a far cry from the recession-era rents of 2009 when prices fell to $600 to $800 a square foot and multiple “For Rent” signs on every block made Madison Avenue look like a close-out sale. It took time for the street to rebound and for rents to rise to current levels. According to a study by the Madison Avenue Business Improvement District, 13 new stores opened during the first six months of 2013.
Frey Wille, a 60-year-old Austrian jewelry brand with more than 100 stores worldwide, opened at 727 Madison Avenue. The retailer, which is launching a U.S. expansion, is also opening a second store in SoHo. Kent & Curwen will unveil in the spring a 2,100-square-foot flagship at 816 Madison.
“Beyond that, we’re working on a strategic plan for them in the U.S.,” said Seigel of the retailer, which hired Simon Spurr as creative director. “They have a significant presence in the U.K. and Asia. We’re looking at markets such as Los Angeles, Chicago, Boston and Washington, D.C.”
Meanwhile, the Brazilian footwear and accessories brand Schutz opened a flagship at 655 Madison Avenue last year.
“There’s definitely been an influx of affordable fashion and affordable luxury,” Harroch said. “That price point is beneficial for overall foot traffic. It creates a dynamic mix on the avenue, which broadens the appeal to consumers. It will ultimately result in an upswing in sales for both [high-priced and lower-priced] categories.”
Retailers that can’t afford to pay top dollar for the most prized blocks of Madison Avenue, however, are venturing farther north and breaking new ground. What was formerly a bastion of mom-and-pop retailers, antiques stores and service businesses is becoming populated by fashion.
“One of the results — and a positive thing in general — is an expansion of the quality of the avenue,” Seigel said. “The high-fashion, high-quality luxury tenants are considering opening farther north on Madison more than ever before.”
Stores that have opened north of 72nd Street on Madison include Everything But Water at number 1060, between 80th and 81st Streets; James Perse at number 1128, between 83rd and 84th Streets, and Halston Heritage at number 1122, also between 83rd and 84th Streets.
One who recently relocated from SoHo to the environs of upper Madison Avenue is Fern Penn and her Rosebud boutique, which specializes in Israeli-designed fashion. For years, Penn dreamed of expanding her store at 131 Thompson Street, but the landlord significantly raised the rent when her lease expired.
“Prices in SoHo have become prohibitive,” said Penn, who was surprised to find that she could afford Madison Avenue between 90th and 91st Streets. She’s sharing the space with Koos van den Akker, whose proprietor, Puck Meunièr, is a friend and asked her to move in.
“We’ve called it Rosebud at Koos,” Penn said, adding that she’s found a customer for her offerings, include collections by Kedem Sasson, Alembika, Dorin Frankfurt and Ronen Chen. “I’m getting new customers and doing the same, if not better, in terms of business in less space. It’s so charming here. I love the neighborhood. Madison Avenue has a cachet about it.”