Location: Your family has been involved in real estate for decades, owning various commercial, industrial and residential buildings throughout New York City. But a shopping mall? Retail is a new frontier for the Hemmerdinger clan, no?
Mr. Hemmerdinger: The interest in retail is all me.
What’s the allure?
Retail is about people and how they spend their time and how they spend their money. Your success in retail is directly tied to whether you enhance the quality of other people’s lives. I think that’s pretty remarkable. On the landlord-tenant side, with office or housing, the owner has a commodity and the tenant wants the commodity. You can be a law firm here or there. You might like this one better, but at the end of the day, it doesn’t matter to the core of your business. Retail is not like that. Tenants need developers to create projects with enough synergy, putting enough of the right tenants together, to be successful. It’s just a completely different animal.
You’ve built the Shops at Atlas Park in Glendale, Queens, on land that has been in your family for a long time.
About 80 years. It used to be about one million square feet of industrial park. At that point, there were real companies doing real work. There was a company called International Container that made most of the cardboard boxes in the U.S. There was a company called Victoria Vogue that made powder puffs. General Foods had a small operation here. …
Starting in the 1960’s, manufacturing started to fall off in the city. By the late 1990’s, it was mostly used for storage. It went from being real tenants doing real things to smaller businesses just really trying to hang on for dear life. …
We needed to do something. And we looked at all sorts of uses. We looked at an office park. We looked at housing. We looked at movies, soundstages, big-box retail …
We thought about everything. But we realized a couple of things. First, that there’s a surprising concentration of affluent house-holds in this area. Now, affluent means a lot of different things to different people. What I mean is people with income to spend on leisure time and on buying things that they don’t necessarily need.
If you look at households earning over $100,000, there are many, many more hundred-thousand-dollar households within three and a half miles of this site than within three and a half miles of downtown Stamford, Conn. Yet, Queens has less than half of the national average of square feet of retail per person—that’s all together, from car dealerships to delis. Compared to, say, Atlanta, it’s actually about a third. There’s roughly nine and a half square feet of retail per person in Queens. Twenty is the national average. Atlanta is 28.
What we wanted to do was create a place where, if you lived in central Queens or eastern Brooklyn, this could be a place where you choose to come for all kinds of different reasons. You might come at 7 o’clock in the morning to exercise. Then you might come back at night to have dinner with your girlfriend, or you might come back on the weekend to come by with your nephews to go to a movie or go to the toy store.
Glendale certainly isn’t exactly known as a shopping mecca. Has it been hard to convince retailers to open here?
Yep. But beyond Glendale, Queens has an image, it’s very kind of specific—you know, Fran Drescher, Archie Bunker and the King of Queens all pushed together. Maybe it was once true, or maybe even it’s still true for some people, but it doesn’t describe all of the two and a half million people that live here. And trying to explain to Coldwater Creek that their customer lives here is hard. Even now, we speak to national retail brokers or retailers’ in-house real estate people, and they’ll say, ‘I’m not interested in Queens.’ It’s hard to know what that means. It’s the entire population of San Diego county!
It’s more than the entire population of the state of West Virginia.
Right. It’s bigger than 19 states. To dismiss it before you even look still doesn’t make sense to me. But it happens all the time.
Is it a good deal, rent-wise, for retailers to come out to Glendale?