toggle

AAPL Stock: 101.63 ( -0.03 )

Printed from http://www.macnn.com

Fifth Ave. store buffs value of NYC property

updated 08:30 pm EDT, Fri June 13, 2008

Fifth Ave store value

An instantly recognizable icon of Apple's retail presence, the Fifth Avenue "Glass Cube" store is said to have contributed to raising the value of the property it sits on by over $1 billion. ifoAppleStore reveals that Apple's $100-per-square-foot retail space, combined with other retail locations in the plaza, have helped the selling price when former owner Harry Macklowe sold the location to Boston Properties Incorporated for $2.8 billion this year.

It is rumored that Boston Properties is exploring revenue generation options, since space occupied by FAO Schwartz, for example, goes for $1000 per square-foot, vastly increased from the $71 it currently pays.




by MacNN Staff

POST TOOLS:

TAGS :

toggle

Comments

  1. lockhartt

    Joined: Dec 1969

    +1

    Ouch

    Hopefully Steve was smart enough to sign a 99-year lease with a rate cap, because it sounds like the new landlord really wants to raise the rent... though it's a little unclear from the article exactly who's paying what.

    Thankfully, the original article makes it a little clearer that implication is that rates for similar space in that area runs $1000/sq ft... but who knows how realistic this actually is, and it should only affect NEW tenants to the building as I can't imagine there isn't a rate cap on FAO's and Apple's leases. I'm sure Steve has his lawyers checking this right now :)

  1. testudo

    Joined: Dec 1969

    +1

    re: ouch

    I believe Apple signed a 20 year lease (based on the articles of how steve wants to take his glass cube with him when the lease expires - which is really stupid, since he has to replace it anyway, might as well make a new one).

  1. Gwydion

    Joined: Dec 1969

    +1

    Wich lease time

    $100-per-square-foot is lease by year, by month or by day?

  1. DahlBryn

    Joined: Dec 1969

    +2

    Value

    In the real estate and leasing market, the dollar-per-sq-ft.
    is a monthly fee. And Apples $100 dollar-per-sq-ft. rate
    may seem high, but is reasonable given the amazing location
    with its significant amount of traffic and 24 hours a day openness.

    Being open twice as long as most retail locations, the NY Apple
    Store more than makes up for the difference in revenues needed
    for the 4,000 sq. ft. locale. That's almost half a million a month !

    In marketing and advertising terms, the monthly fee is extremely
    reasonable given the benefit of traffic generation via its glass cube
    for locals and tourists is something that can't be measured in dollars.
    In this stores case, it's about "presence" perceived brand value.

    Besides, all this is mute - as it's cheap. Apple's other large Manhattan
    Store in an old meat packing district costs $400-per-sq.-ft.
    How's them apples ?

  1. Gwydion

    Joined: Dec 1969

    +1

    My god

    I don't know if $100-per-square-foot in NY is a high value but here in Barcelona in the street analogous to where it's this Apple Store the price is 2300 €-per-square-meter a year or 191 €-per-square-meter a mont and this is $2000-per-square-foot.

  1. bjojade

    Joined: Dec 1969

    +1

    Per year, not per month

    Usually when you get a price quote per foot, that is the price per year, not per month, at least in all of the leases I have dealt with. $100/sq ft is amazingly cheap for that area. Even in small town Wisconsin, $20/sq ft is normal.

    If you read the article linked, it confirms this rate as being per year:

    Real estate sources say FAO is paying about $71 per square-foot per year on nearly one-half of its space, in an area where the market rate is over $1,000 per square-foot. Real estate analysts believe Macklowe lured Apple to the site with a lease charging about $100 per square-foot.

  1. nativeNYer

    Joined: Dec 1969

    +1

    surprised

    As a New Yorker, I'm surprised at the rate of $100/sq ft for that space. That's actually incredibly cheap given the prime location right in the shopping district heart on 5th Ave. I'm not sure how Steve negotiated such a low rate on that. Perhaps because it's almost all underground?

    Anyway, I also hope Apple has a long lease with a fixed rate, because it sounds like if the new owners had their way, they'd up that rate quite a bit.

    Damned greedy landlords- they're everywhere!

Login Here

Not a member of the MacNN forums? Register now for free.

toggle

Network Headlines

toggle

Most Popular

MacNN Sponsor

Recent Reviews

Autodesk Smoke 2015

Since May of this year, Autodesk has been shipping the highly anticipated update to its high-end post-production video editing suite, ...

Crucial MX100 256GB SATA-3 SSD

While the price to gigabyte ratio for magnetic platter-based hard drives can't be beat, the speed that a SSD brings to the table for ...

Narrative Clip

With the advent of social media technology, people have been searching for new ways to share the events of their daily lives -- be it ...

toggle

Most Commented