Piering Into a Busy Retail Future
With retail and other sectors of the real estate industry beginning to rebound, Sierra Realty executive vice president Peter Braus and his colleagues are in the enviable position of being the marketing agent for 140 William Street, which currently boasts more than 40,000 square feet of vacant space. Meanwhile, the firm has been tapped as a food consultant for the proposed Pier 57 mixed-use project, which could become a culinary hub for the city. Mr. Braus, 42, sat down to talk about retail and what’s in store for 140 William Street and Pier 57.
The Commercial Observer: As the economy rebounds, what do you predict will happen in New York’s retail sector?
Mr. Braus: New York has a lot of positive drivers that have been different than what’s going on in other parts of the country. In addition to the tourism, our local retailers are just very resilient. If they sense any weakness in the market they’re going to pounce on deals, and now you’re certainly seeing a lot of bigger companies coming back into the market–maybe companies that have never even been here before are now coming in a strong way.
There was a lot of space available on Fifth Avenue between 42nd Street and Rockefeller Center, and now there isn’t. That was last year; you had four or five major vacancies. Now you’ve got Syms and you’ve got Guess. There’s significant deals that have been done in the last 12 months that have filled in some big holes. On Madison Avenue, by my count, you had about 18 vacancies back in early 2009 and now, in late 2010, that’s down to half a dozen. So I think our market shows a lot more ability to bounce back than some of these other markets. If you go down to Florida or Arizona or Las Vegas, you see acres and acres of empty space.
From what I understand about 140 William Street, it sounds like the sky is the limit in terms of what kind of tenancy could occupy the building’s 40,000 square feet of vacant space. That said, what, in your mind, would be the ideal use for the building?
Ideally, I’d like to see a single user for the whole building because I think there’s such a limited number of empty buildings where an entity–whether it’s a university or a medical group or some not-for-profit or a corporate group or even a retailer for that matter–can come and occupy a full building with over 40,000 square feet. There just aren’t that many buildings like that in the city right now. That’s what I’d like to see.
But, as you said, because of the zoning of that area there’s a great ability to do a number of things there. You can put some residential in there, which we’re talking about for the penthouse floors. We’re talking about possibly doing office tenants on the individual floors. So we can go a number of ways, but in answer to your question, I’d love to see a single user. That would be the best use.
Sierra has been tapped as a consultant for a project on Pier 57. Tell me about it.
Pier 57 is located at 15th Street, just off the meatpacking district, and it’s about 350,000 square feet. It was formerly an M.T.A. bus pier, and the Hudson River Park Trust did an RFP about a year and a half ago, and the winner of the RFP was Youngwoo & Associates, which you might know from their purchase of the AIG buildings and a number of other projects in the city.
So Youngwoo was the successful RFP bidder, and what their project basically consists of is creating a mixed-use pier with some retail. The Tribeca Film Festival is going to be occupying the roof, along with a public park, and the Tribeca Film Festival is going to be presenting filmed entertainment to the public at no charge. And a large component of this pier–approximately a third of it–is going to be food-related. And Sierra has been hired to act as the consultant for Young Woo on the food portion.
So what, exactly, does that entail?
What we’ve been doing is going out on behalf of Youngwoo and speaking with all of the leading restaurant groups in the city and some international and some around the country, as well as other types of institutions. Beyond restaurants, but food-related; we want to essentially bring in a variety of tenancies. So, for example, we’re speaking with some culinary education institutions, and one of the possibilities is doing an actual campus on the pier with students. In New York City, aside from the French Culinary Institute, which is in Soho, and a couple of other schools, there is no true campus in New York City for a culinary institute.
That’s a great idea.
Well, we think it could be really exciting. So that’s something we’re exploring. We’re also exploring some potential broadcast from the pier, doing food broadcast from there that are similar to what’s being done on TV now–but sort of live broadcasts that will be interacting with the restaurants that will be on the pier.
It sounds like if everything goes as planned, it could be a new culinary hub for the city.
We think it will be a cultural and culinary hub because the retail that will be going there, it’s not going to be a sort of mall or big-box retail. It’s going to be more carefully curated–a lot of retailers who are in some cases making their wares on the pier. So it’s going to be a very, very interesting mix. There’s going to be many, many tenants. It’s not going to be putting this 20,000-foot tenant here, and we’ll put this 40,000-foot tenant there, and three or four more tenants and you’re done. Because that’s not what the vision is. The vision is to make it a pier that is going to be visited often by residents of the city, by tourists coming to the city, and we think, frankly, that it’s going to become one of the best attractions in the city when it opens.
So what makes Sierra Realty qualified for this assignment?
Well, that’s a good question [laughs]. I wonder that myself sometimes. Basically, what I presented to them was the fact that in addition to having done several dozen restaurant transactions in my career, and having very good contacts in the restaurant community, I’m also a board member of the Friends of Hudson River Square Park, so I have a great deal of knowledge and expertise of the park. And I’m very devoted to seeing that the park continues to improve and prosper.
So my feeling was that I could bring to them not only my knowledge of the restaurant community but also of the park, and sort of facilitate working with the trust, with whom I interact often. So it was sort of a natural fit. So we kind of put together a very strong team and we went in and talked to the folks at Woo, and I think they felt that we were not cookie-cutter brokers going in with the same pitch that they hear from a lot of other people.