Real estate continues to churn on 57th Street between Fifth and Sixth Avenues as upscale retailers and national discounters displace the middle-market, mom-and-pop stores.
Paron Fabrics, a 30-year tenant at 56 West 57th, is the latest victim of the squeeze. Vice President Barry Babyatzky said the soaring rents are forcing him to consolidate his two floor store into one.
“Years ago there were about seven fabric stores up here. Now there’s nobody left,” he said.
Three other properties are for rent on that block, as well. Women’s retailer Charivari is closing. A site at 6 W. 57th that was a former theater is on the market. So is the Greenwich Savings Bank Building across the street.
While the buildings themselves are up for grabs, so, it seems, is the character of the block.
Their leasing agents are hoping to lure luxury tenants with the cache of Fifth Avenue. “We’re looking to draw an upscale retailer like Bergdorf or Tiffany,” says Howard Dolch of the Lansco Corporation, which is leasing the bank building. “Something in fashion or jewelry.”
“The block is primed for gentrification,” says Steven Greenberg, the real estate consultant who just leased the old Henri Bendel building to Gucci, while it completes renovations on its Fifth Avenue store. “Laura Biagiotti, she’s opened up, and you have Holland & Holland, the British outdoors company.”
There are indeed plenty of luxury stores on West 57th between Fifth and Sixth Avenues. The jeweler Bulgari is on the corner and Lladro, which sells expensive figurines, is in the middle of the block.
But McDonald’s, office supply store Staples, discount clothing retailer Strawberry and the Sports Authority lurk nearby, closer to Sixth Avenue. They can easily pay the rents that compressed Paron, from $150 to $350 a square foot for the block.
But the discounters also give the block a kind of split personality, diluting the rarified atmosphere further East. Despite the boom in real estate, say agents, rents there will never go as high as they are right across Fifth Avenue. Buildings on the first block of East 57th now command $300 to $700.
Real estate agents acknowledge the situation. Some lament the relatively new leases given to the discounters, saying their landlords were short-sighted. But many insist there is still opportunity on the block.
“It’s a real mixed bag on the street,” says Faith Consolo, who is representing the Paron store. “The whole world isn’t upscale, and 57th street has got incredible traffic. Tourists walk west to the Hard Rock Cafe. You’re still on ‘hotel alley.”‘
Others point out that exclusive stores have learned to live with their mass market cousins. Despite their initial reservations, Fifth Avenue merchants such as Tiffany’s, Chanel and Harry Winston have survived the incursion of NikeTown and the Warner Brothers Studio Store and Walt Disney Stores. Many of the luxury stores have actually been thriving, because tourist traffic has increased.
Brad Mendelson, who represents the former movie theater at 6 W. 57th, says prospective tenants have not been scared off by the nearby discounters: “I think what the tony retailers have found is that America seems to cross-shop these days. They’re just as interested in a good bargain as they are in an Hermes tie.”