Retail shake-up at 650 Fifth

Real Estate Weekly,  Dec 19, 2007  by Daniel Geiger

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Children's clothing retailer, Children's Place, is being bought out of its lease at 650 Sixth Avenue in a deal that will help free up over 11,000 s/f of retail space in the base of the building.

Retail broker Cory Zelnik, who started his own real estate firm Zelnik & Co. last year and continues to snag large retail assignments around the city, will market and lease the space.

Zelnik arranged for the exit of Children's Place, which he says will allow him to combine the space with existing vacancy and appeal to a larger tenant, or maintain the current multi-unit layout, but reconfigure them so that three units have frontage on Sixth Avenue.

Currently only Children's Place and the building's other retail tenant, FedEx Kinko's, face the avenue. Another space is tucked away on the side street, 20th Street, but that space now too will have a more prominent location because it will be located next to the building's lobby.

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Zelnik, who for years was part of a brokerage team that handled leasing for Duane Reade throughout Manhattan, said that the full 11,135 s/f space could appeal to a major drug store, which has been conspicuously absent on that stretch of Sixth Avenue given its high foot traffic.

Zelnik said that the space could also appeal to apparel companies or a restaurant. 650 Sixth Avenue is being converted into a residential condo building. About 6,000 s/f of the retail space is currently being used as marketing space for the building, but that office is being vacated because most of the residential units have been sold.

"It's an added plus marketing this type of retail space when you have a building like this that's almost fully sold and has been made into a much hipper building," Zelnik said.

The ground floor retail, which consists of roughly 15,000 square feet and almost that much space below grade, is owned as a condo unit by the real estate investment firm, the Beehive Group. FedEx Kinko's has what is typically considered the most valuable portion of the space, the comer, on 20th and Sixth Avenue.

The tenant pays below market rents and has years left on its lease. A deal may be in works though, to reposition FedEx Kinko's within the space, freeing up the comer and incorporating it into the availability, which would make the space even more attractive to tenants.

COPYRIGHT 2007 Hagedorn Publication
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