Wooing Walmart: NYC brokers still have eyes for elusive retailer
Daniel Edward Rosen Dec. 7, 2011, 1 p.m.
The weekly phone calls. The dinner invites. The gifts.
When representatives from Walmart, the nation’s largest retailer, waltz into the New York Hilton for this year’s two-day International Council of Shopping Centers conference, many of the city’s most intrepid retail brokers will be close behind them, perhaps even plying those officials with compliments, dinner invitations and business opportunities.
So it goes for the 50-year-old, Arkansas-based retail chain, which since 2005 has continued to seek big-box space in New York City’s five boroughs despite thrice being spurned by the City Council, civic groups and labor unions upset with the company’s decision to roll back health care coverage for part-time workers and raise premiums for full-time staff.
As retail brokers told The Commercial Observer last week, however, the chain continues to draw flirtatious advances from agents attempting to land what, no doubt, would be one of the city’s biggest leasing assignments in years. Because the company has no dedicated real estate broker, most continue to send their love, some even on a weekly or monthly basis.
“They’re constantly calling them,” said Patrick Breslin, an executive vice president of East Coast Retail Services for Studley, who said he has observed colleagues fawn over Walmart executives. “It’s a relationship business.”
As for a dinner audience, however, Walmart has a stricter policy than other large-scale retailers, such as K-Mart or Target, according to brokers who said the chain has turned down dinner invitations due to a long-standing restriction.
“When it comes to accepting stuff, Walmart is one of the leaders in banishing that from the business,” said Mr. Breslin. “I was at a lunch once with some Walmart guys and a real estate developer who represented Walmart,” added Mr. Breslin.
“I was just tagging along. I just happened to be in the city that day, and he said come out for lunch with me. He went to pay the bill, and the two Walmart guys were whipping out their cash and checkbooks to pay their portion of the bill.”
Still, the chain came close in 2005 to setting up shop in a Vornado Properties-owned, 132,000-square-foot space in Rego Park, Queens, but it was met with swift opposition by City Council members and other public officials who decried its tendency to gobble up small mom-and-pop stores in its path. Walmart and Vornado eventually backed away from the plans.
Since then, other big-box retailers with less political controversy have opened up throughout the outer boroughs: Costco, Century 21, Kohl’s, B.J.’s Wholesale Club, Target, even German retailer Aldi.
In the meantime, Related Companies has reportedly been speaking with Wal-Mart about moving into a 650,000-square-foot site in its Gateway II shopping center in East New York, Brooklyn. The City Council and many public officials remain opposed to any such development, including State Senator Diane Savino, who has criticized the Related Companies for its Wal-Mart overtures.
Three other Queens politicians, meanwhile, sent a letter to Related chief executive Stephen Ross urging him not to bring the retailer to Gateway II or any other Related-owned New York City location.
In the meantime, a long line of brokers and landlords made overtures at a booth tended by Walmart at the ICSC conference on Monday, but most were referred to a representative of the chain’s “Real Estate Directors East” team, Mary Rottler, who, one Walmart representative said, “would be at the conference [Tuesday.]”