The company is the owner of retail condos and co-ops, including the retail space and parking facility at the Manhattan House condo on the Upper East Side; 380-386 Broome Street in Little Italy, the home of Umberto’s Clam House; retail space in Times Square at 1657 Broadway; the retail condo at 1880 Broadway (also known at 15 CPS), home of Best Buy, West Elm and JP Morgan Chase; and 754 Fifth Avenue, the Bergdorf Goodman Building.
Madison and other real estate investors have been actively seeking to acquire such retail space in condos and co-ops in Manhattan. To increase the value of a residential condo, many developers are offering the ground-floor retail space for sale, especially if one of the tenants is a well-capitalized financial institution like TD Bank or JPMorgan.
Jones Lang LaSalle has been retained to sell the retail condo at One Jackson Square, an 8,709-square-foot space with three ground-floor retail storefronts and basement storage at the corner of Eighth and Greenwich avenues, south of 14th Street. The ground-floor space totals 7,080 square feet and is 78 percent occupied by two investment-grade tenants, TD Bank and Starbucks.
Speaking of TD Bank, many of the bank branch locations opening up on New York street corners are occupied by the Canadian concern. As I reported earlier in the year, the 3,750-square-foot retail condo at the southwest corner of 49th Street and Second Avenue occupied by the bank on a long-term net lease was sold for $11.1 million to a South American investor.
Industry insiders believe that another location with a TD Bank is also for sale: the one in the retail condo at 400 East 67th Street, at the corner of First Avenue, in the Laurel Tower.
In the heart of Soho is 210 Lafayette Street, also known as One Kenmare Square. The 12-story, mid-rise tower is located at the east end of Delancey Street, where it meets Cleveland Place and Kenmare and Lafayette streets. The 33-unit condo was a development of Andre Balazs and Cape Advisors. Eastern Consolidated has been retained to offer for sale the two-story retail condo, with 7,400 square feet on the ground floor and 4,000 square feet in the basement. The space is fully leased to the Mitchell Gold Co., a high-end furniture store, through March 2017, and has an asking price of $15.950 million.
A few blocks away is another commercial condo at 202 Spring Street, also known as 84-89 Sullivan Street, on the southwest corner of Spring and Sullivan streets. It’s 3,200 square feet on the ground floor and lower level of a seven-story building.
The retail condo or the entire building is for sale at 654 Broadway in Noho, on the east side of Broadway at Bond Street. The retail tenant is located on the ground floor, currently occupied by Shoe Mania on a long-term lease that expires in 2028.
Massey Knakal’s website reports a major reduction in the asking price for the retail condo at 200 Riverside Boulevard in the base of the residential high-rise Trump Place, between 69th and 70th streets. The asking price for the vacant condo, with 13,098 square feet of ground floor retail and 7,944 square feet of storage in the basement, has been reduced from $8.95 million to $5.5 million. The firm is also selling retail and office condos at 80, 100 and 120 Riverside Boulevard in Trump Place and Rushmore residential.
In Rockefeller Center, at 16 West 48th Street, is the 34-story, 131,500-square-foot residential condo the Centria, a project of J.D. Carlisle Development Corporation. The building, which was completed in 2006, has a total of 152 residential condos, and the developer is now offering for sale the retail condo on the first floor.
Kips Bay is a highly regard section of Manhattan for retail. There, the master lease for two retail units at 201 East 25th Street and 200 East 27th Street are being marketed for sale by Eastern Consolidated. The 12,618-square-foot commercial property is occupied by a 78-spot parking garage, a D’Agostino supermarket and a Ricky’s.
Forty to 50 years ago, 14th Street at Union Square was one of Manhattan’s premier retail streets. J.W. Mays Department store was located at 40 East 14th Street, presently known as 4 Union Square South, the home of Whole Foods, DSW, Filene’s Basement, Forever 21 and Jamba Juice. Zeckendorf Tower at 1 Irving Place and Park Avenue South between 14th and 15th streets replaced the flagship store of S. Klein’s On-the-Square Department Store. Today, Union Square serves as the home of other prominent retailers, which include Best Buy, P.C. Richards, Nordstrom Rack, Duane Reade, Citibank and Walgreens.
As I reported earlier in the year, the State Teachers Retirement System of Ohio is now an owner of Union Square retail. The pension fund has acquired the four retail stores on the first, mezzanine and cellar floors of the building at 15 Union Square West. It paid $57.88 million, or $3,993 per square foot, for the 14,494 square feet of retail space. Three of the four stores are leased to HSBC Bank, Lululemon Athletica and Sketchers.
With the success of urban retailing, it looks like investors will continue to pursue ownership opportunities in this asset class for the foreseeable future.
mstoler@madisonrealtycapital.com
Michael Stoler is a managing director at Madison Realty Capital and president of New York Real Estate TV LLC.
