Before the outbreak, major brands settled on Fifth Avenue in New York at high rents. But now, in order to save rent expenses, brands have successively closed their stores on Fifth Avenue, making this place a place where tenants and landlords The invisible battlefield between.
According to Bloomberg, within 20 blocks around Fifth Avenue, some landlords said they were owed nearly $200 million in rent, and brands such as Valentino and Marc Fisher have been involved in rent disputes. in the case.
In February this year, the Italian luxury brand Valentino was sued by 693 Fifth Owner LLC, the landlord of its flagship store on Fifth Avenue in Manhattan, New York, for terminating the lease early, demanding compensation of 207.1 million. Dollar.
In March, Italian shoe brand Marc Fisher was sued by the Trump Organization, which demanded that Marc Fisher pay $1.5 million in arrears in rent at Trump Tower.
Tom Mullaney, general manager of real estate agency Jones Lang LaSalle Inc., said: “On the one hand, the epidemic has caused brands to face some financial pressure, and some brands have to Instead of exiting Fifth Avenue and looking for a location with a more suitable price; on the other hand, the landlord has been unable to receive rent, causing problems with his own cash flow, so the current situation is very painful for both tenants and landlords.”
Rising vacancy rates are forcing Fifth Avenue landlords to lower rents. Data from real estate consulting firm Cushman & Wakefield (Cushman & Wakefield) show that rental prices on the first floor of buildings in the 42-49 blocks of Fifth Avenue South fell by 20% year-on-year in the fourth quarter of last year; the northern part of Fifth Avenue extends to the 60th block. Rents fell by an average of 3.7% to US$2,575/square meter. Currently, the vacancy rate in these two areas exceeds 23%.
Although there are still some brands opening stores on Fifth Avenue by transferring or re-entering lease agreements, The vacancy rate here will continue to rise, setting up obstacles for Fifth Avenue’s business recovery.
In February, Italian luxury brand Gucci said it had renegotiated and extended its lease with Trump Tower at 721-725 Fifth Avenue in New York.
In November last year, American fashion luxury group Ralph Lauren Corp subleased a large store on Fifth Avenue to Spanish fast fashion retail chain Mango.
Informed sources revealed that the leases of Giorgio Armani (Giorgio Armani) and Abercrombie & Fitch will also expire within two years, but it has not been clear whether to renew the lease or withdraw from Fifth Avenue. </p
