REAL ESTATE

L.T.J. Arthur leases West Village location

BY CSA STAFF

New York City French apparel retailer L.T. J. Arthur announced April 22 that it has signed a long-term lease for 400-sq.-ft. of ground-level space at 329 Bleecker St., in Manhattan.

The boutique, located in the West Village, is expected to open in spring 2009.

“Bleecker Street is a destination for shoppers who enjoy the abundance of boutique retailers that line this popular retail corridor. This prime corner location featuring 44 ft. of wrap-around frontage gives L.T.J. Arthur excellent visibility and positioning in the New York marketplace just as it begins its national expansion,” said Dan Wolf, a director at New York City-based Lansco, who represented L.T.J. Arthur in the lease transaction along with Lansco executive VP Robin Abrams.

L.T.J. Arthur, retailer of chic loungewear and beachwear, opened a total of three New York metropolitan-area retail locations in 2008 — at 922 Madison Ave., at The Plaza, and at Westchester Mall in Westchester County, N.Y.

The retailer plans to open 150 additional stores in the United States as well as 50 stores in Canada within the next five to 10 years, according to Wolf, who also represented L.T.J. Arthur in its lease for space in Los Angeles’ Century City, where the retailer is slated to open in April. Wolf also recently secured locations for the retailer at Santa Monica Place in Santa Monica, Calif., The Streets of Buckhead in Atlanta, Scottsdale Fashion Center in Scottsdale, Ariz., and The Bravern in Bellevue, Wash.

“After successfully growing L.T.J. Arthur’s European presence, we are taking advantage of opportunities in the current economy to lock in favorable lease terms that will be advantageous as we proceed with our expansion plans in the United States and Canada,” explained Laurent Bourrelly, CEO of L.T.J. Arthur in North America. “We will continue to be creative and productive in any economy, actively pursuing locations in central retail and business districts as well as high-end malls to spread our vision of ‘joie de vivre’.” 

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REAL ESTATE

Timing appears right to bid on projects

BY Michael Fickes

Right now might be a good time for developers and owners to bid and start construction projects and for retailers to consider new leases in areas where they are under-represented.

Why? Construction material manufacturers and commodity vendors are cutting prices, and contractors are sharpening their estimating pencils.

In mid-April, the Bureau of Labor Statistics released the most recent Producer Price Index report, which showed that construction materials were declining in price. The price of materials used by commercial building contractors declined 2.6% over the past year.

And since stimulus funds from the American Recovery and Reinvestment Act started flowing into the states, contractors suffering through the recession have been showing up en masse to bid on available projects. The increased competition has driven prices down.

According to a Washington Post report in early April, Baltimore-Washington International Thurgood Marshall airport officials typically expect two or three construction companies to place bids on projects. They were surprised when six companies placed bids on a renovation estimated to cost $50 million. They were stunned when the newly competitive bidding environment enabled them to let the job for just $42 million.

The Post also noted that a Connecticut road project budgeted for $75 million had been let for $66.6 million.

Commenting on the current environment, Ken Simonson, chief economist for the Associated General Contractors of America, said in a prepared statement:

“The price declines make this a great time for public agencies and private owners alike to start construction projects, particularly because this ‘limited-time sale’ may not last much longer. Copper and diesel prices have recently moved up, and steel markets are sending mixed signals.”

Another statement issued by Simonson in early April said that, “It is growing more likely that real (inflation-adjusted) gross domestic product will rise slightly in the quarter that began on April 1 from the dismal levels of the first quarter. The growth is likely to pick up gradually throughout the rest of the year, but it will be uneven, unlike the downturn that affected all sectors.”

As an example of this unevenness, Simonson doesn’t expect retail construction to resume until early next year. Even so, for developers and owners with access to capital, low prices for materials and construction work could help projects that have been put on hold get back on track; and for retailers interested in holding down leasing costs, lower-cost retail shopping centers may offer lower cost pre-leasing deals.

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REAL ESTATE

Waiting for the next big thing

BY Michael Fickes

Desperate economic times produce hardship, but they also give rein to creative and innovative thinkers. The Great Depression of the 1930s produced a host of ideas that formed the foundations of today’s retail and retail shopping center industries.

In 1929, for instance, a group of department stores joined forces and formed Federated Department Stores, with headquarters in Columbus, Ohio.

The following year, Edwards Theatres Circuit opened the first multiplex in the United States.

Publix Super Markets was also founded in 1930.

In 1932, Joseph C. Thompson became president of the bankrupt Southland Ice Co. and reorganized as a retail business selling foods and conveniences. Today, the Southland Corp. operates the franchising business that has spread 7-Eleven stores around the world.

“Now’s the time to look for ideas that will catch on,” Spence Mehl, senior VP of New York City-based RCS Real Estate Advisors, told SiteTalk. “Rents get cheaper as landlords need to fill vacant space and drive traffic. Low rents will attract people with ideas and very little money.”

While waiting for the next big thing, landlords are filling space with retail or non-retail businesses. A business that can pay the rent can have the space. So dance studios, karate studios, skating rinks, health clubs and glow-in-the-dark miniature golf courses are moving into malls and shopping centers.

“Empty freestanding big boxes are attracting churches,” observed Mehl. “I have a trade school looking at a 70,000-sq.-ft. space in Indianapolis right now. And discount stores such as Big Lots, Dollar Tree and Dollar General are moving into large empty spaces.”

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