“Things are picking up,” said Robert Futterman, chairman of brokerage Robert K. Futterman & Associates. “It’s all because tenants are interested in expanding, based on rents that are much less than they were two years ago.”
OTHER RETAILERS ARE attempting to capitalize on the economic mood by appealing to a more price-conscious consumer. Nordstrom, based in Seattle, had been looking to break into New York for years, but ended up settling on a discount version of the store, called Nordstrom Rack, which opened in Union Square last week. The store, with 25,000 pairs of discount shoes and around 30,000 square feet, is sure to appeal to a broader consumer base, and will capitalize on the heavy foot traffic in the Union Square area.
Even the luxury designer Carolina Herrera decided to open a more affordable store, CH Carolina Herrera, by signing a lease for 2,300 square feet at 802 Madison Avenue.
Midrange and discount stores such as TJ Maxx, which signed a lease at 250 West 57th Street in April, are always looking to expand. Times Square, another high-traffic area, has transformed into a fashion corridor, with the likes of Forever 21, Levi’s, Quicksilver and Billabong.
Online shopping, while growing, is only an estimated 5 percent of U.S. retail sales, according to CoStar, and pixels can’t match the physical experience of walking into a brick-and-mortar store, particularly for apparel retailers. While it has gutted some industries, such as music stores, the Internet is still a secondary market for most companies.
For the most successful retailers, the store is not merely a repository of products, but an extension of the overall brand. “The ones who know who they are, and have developed a dialogue with the consumer that resonates clearly -they’re always the best positioned,” said Michael Hofmann, senior managing director of the retail division at brokerage Cassidy Turley.
And as the city of celebrities and spectacle, New York seems well positioned in its retail market for the rest of the year, and full recovery may come around as soon as early 2011.
“The general outlook is one of optimism. New York City is where the opportunity is found,” Ms. Consolo said. “This is the city where brands are made.”