BANANA REPUBLIC INKS NEW SOHO SITE
Byline: Sharon Edelson
NEW YORK — Seeking to expand its downtown franchise, Banana Republic has signed a lease for a 10,000-square-foot store at 524 Broadway in SoHo, a half-block south of an existing unit, according to a real estate broker involved in the transaction.
The new store will be devoted to men’s wear, while the original 6,000-square-foot store at 552 Broadway will sell women’s apparel, said Stephen Asch, president of New Spectrum Realty Services, who brokered the deal.
“They’re doing what they call a ‘banana split,”‘ Asch said. “They’re doing so much business, they need more space.”
The new store, on the northeast corner of Spring Street, is expected to open next spring, Asch said. It will be the firm’s 14th in Manhattan. Stores are also set for Grand Central Terminal, the World Trade Center and Madison Avenue at 74th Street.
Banana Republic executives could not be reached for comment.
In Manhattan’s tight real estate market, expanding a successful store is no easy trick. Saks Fifth Avenue has made no secret of its desire to lease space for an amplified men’s store close to its flagship, and Banana Republic wanted to expand its store on Fifth Avenue and 52nd Street. So far, both companies have been unsuccessful in those endeavors.
But Banana Republic cracked the hot SoHo real estate markets by paying top dollar for the Broadway space, real estate experts said, well in excess of $100 a square foot.
A measure of how inflated the SoHo market has become is that the same space would have rented for $50 a square foot two years ago, brokers said. “All the usual suspects of national chains were bidding for that space,” Asch said. “It’s a corner space and one of the best in SoHo.”
“Unfortunately, if a tenant needs to expand in this real estate climate, it comes down to having corporate strength behind them and a willingness to play on the landlord’s terms,” Asch said. “That generally means increased rents. The deals being consummated now far surpassed anything we saw in the Eighties, which was the peak when rents achieved record values.”