GGP Signs Five-Dollar Store on Prime Fifth Avenue—Some Brokers Say, WTF?
Five Below, a national chain where “everything, every day, is just $5 and below,” is opening a flagship at General Growth Properties’ 530 Fifth Avenue retail condominium unit for its first Manhattan location.
The 10,800-square-foot store—about 2,800 square feet bigger than Five Below’s average outpost—will open later this year at the property between West 44th and West 45th Streets, according to CNBC, which broke the news of the deal. Lease details weren’t immediately available.
Some brokers expressed disappointment with the tenant selection.
“It’s not a Fifth Avenue-type tenant. Everyone is pissed,” one broker said of the deal because of the nature of the tenant on a prized part of Fifth Avenue. He added: “There goes the neighborhood.” A more suitable location, the broker said, would have been south of 42nd Street.
“Not sure this was the tenant surrounding landlords with available space were hoping for,” said Jeffrey Roseman, a vice chairman at Newmark (NMRK) Knight Frank Retail, who was not involved in the deal.
Another broker addressed how it could draw similar tenants.
The deal sends “a signal to the type of retailers who may have focused on Times Square or Broadway in Soho that Fifth Avenue should be considered,” said retail broker Robin Abrams, a vice chairman at Eastern Consolidated. “Yes, it will likely attract off-price or discount retailers to the corridor—tenants that focused in Herald Square or on 14th Street prior—although low price points don’t have to mean ‘schlocky’ and both locals as well as tourists will go there.”
Noting the benefit of tenant diversity, James Famularo, the president of Meridian Capital Group‘s retail leasing division, said: “I think it was a good move. Not everyone will pay $250 for a jersey from the NBA store or $398 for a parka from Lululemon.”
Five Below will join Vans at the property, as the skatewear apparel and shoe seller inked a deal for a 8,573-square-foot store last November.
Five Below has more than 630 stores in 32 states, according to its website, with plans for 125 stores to open this year. The value retailer sells cell phone cases and chargers, remote-control cars, yoga pants, graphic tees, nail polish, footballs and soccer balls, candy and holiday apparel.
“Five Below is the updated variety store or five-and-dime store of our day—something for everyone,” said Faith Hope Consolo, the chairman of the retail leasing and sales division at Douglas Elliman. “As for the character or image of the street, that is not really affected or important. The key is that a big space was absorbed and this type of tenant will generate traffic.”
“This is a unique opportunity for us to establish a presence in one of the world’s most iconic and popular shopping destinations and introduce new customers to the Five Below brand,” Five Below CEO Joel Anderson said, as per CNBC.
The Manhattan store “will be built with New Yorkers and tourists from around the world in mind, featuring local merchandise where there’s extra space inside,” the company told CNBC.
This is not the first time GGP and Five Below have transacted.
“Ownership has this tenant in many of their buildings outside the city [in] strip malls and suburban areas and strip centers,” Consolo said.
A representative for Five Below didn’t respond to Commercial Observer’s request for comment and GGP didn’t provide responses by publication time.