Stores Take Flight From Fifth Avenue in Manhattan

Stores Take Flight From Fifth Avenue in Manhattan

- in Business
34
0

End of 2011

Average Asking Rent

$2,388

End of 2016

Average Asking Rent

$2,985

Ralph Lauren, a brand that helped define American fashion for much of the past half-century, has struggled to reinvent itself for the modern era. It has long subsisted on core products like Gatsby gowns and polo shirts.

It opened its Polo location on Fifth Avenue toward the end of 2014. The next year, it appointed a chief executive, Stefan Larsson, for the first time, an acknowledgment that the brand’s eponymous founder needed help to compete with fast fashion and other challenges. Last year, Mr. Larsson announced a plan to trim Ralph Lauren’s many labels and focus more on creative designs and a quicker production timetable.

His path toward reinventing Ralph Lauren, however, was short-lived. Citing creative differences with Mr. Lauren, Mr. Larsson said in February that he would depart the company on May 1, an abrupt shake-up that sent the stock price tumbling.

An empty retail space on Fifth Avenue.

Credit
John Taggart for The New York Times

In its most recent quarter, which ended on Dec. 31, revenue fell more than 12 percent to $1.7 billion, and the company said that it was on track to close 50 stores by the end of this fiscal year. On Tuesday, Jane Nielsen, the chief financial officer, said in a statement that the Polo closing helped “ensure we have the right distribution and customer experience in place.”

The company declined to comment further about the decision. Shares of Ralph Lauren fell 4.5 percent to close at $77.74 on Tuesday.

Landlords along Fifth Avenue have not had much sympathy for the troubles of the retail industry. At the end of last year, the average asking price for a square foot of retail space from 49th to 60th Streets was more than $2,900, up from $2,283 at the end of 2012, according to data from Cushman & Wakefield.

Those figures make the area one of the most expensive in a city known for the stratospheric cost of its real estate. But other factors have affected retailers’ prospects in the area, too. Foreign tourists, who typically spend more than domestic visitors, have been pinched by the declining value of the euro and the pound.

And for the first time since the recession, New York City is expecting a drop in international tourism, citing President Trump’s recent travel ban and protectionist rhetoric.

NYC & Company, the city’s tourism and marketing agency, projects that 300,000 fewer international travelers will visit the five boroughs this year. While domestic travel is expected to remain strong, the group has cautioned that it takes four domestic travelers to equal the spending power of one international visitor.

Fifth Avenue was particularly hard-hit between the presidential election in November and the inauguration in January, when Mr. Trump, then the president-elect, continued to work out of Trump Tower, on the avenue between 56th and 57th Streets. Swarms of security personnel made a leisurely stroll around Trump Tower into a nightmarish maze, slowing foot traffic to nearby retailers.

“Yes, there are still some gates and cement barriers,” said Tom Cusick, the president of the Fifth Avenue Business Improvement District. “But the kinds of problems that we had between election and inauguration have mostly evaporated.”

Mr. Cusick acknowledged that the turnover in the past two years or so has been higher than what he has seen in the past decade. But, he said, those spaces are not staying empty.

“There are stores moving in,” he said. “In six months to nine months, if you walk up and down the corridor the same way you might today, you won’t see as many closed stores.”

Continue reading the main story

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

You may also like

The Newseum Is Increasingly Relevant, but Can It Survive?

But just as the profession it celebrates is