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New York Real Estate Journal

Now is the time for global brands to enter the New York City retail market – by Lee Block

The story of brick-and-mortar retail’s demise has been a popular narrative both far and wide. The recent spate of nationwide store closings and bankruptcies from well-established brands have caused some alarm amongst retailers. In New York City specifically, high retail rents have priced out many businesses as landlords demand top dollar. In turn, vacancy rates have steadily climbed over the past 24 months to levels approaching those seen at the height of the Great Recession.

However, the economy of New York City today is much different from that in 2008, or even at the height of the retail boom in 2014 – in fact, it is more robust than ever. The Gross City Product (GCP) of New York is $1.5 trillion, second only to Tokyo amongst cities, and would rank amongst the top 20 countries in economic output – placing it just behind Canada ($1.6 trillion). Moreover, the city’s growth rate continues to outpace other major industrialized European cities, and the U.S. as a whole. New York’s GCP has grown at a rate of 2.3% in Q1 and Q2 of 2017, while the U.S. GCP has grown at a rate of 0.7% during the same time. New York is also adding over 33,000 jobs (3.1%) per quarter in 2017. And its unemployment rate of 4.3% is the lowest ever recorded for the city. In a time where wage stagnation is a major concern for the U.S. and other industrialized economies, New York’s personal income rose 9% year-over-year from 2016.

With that knowledge in hand, it can be inferred that climbing vacancy rates and ensuing rent reductions in the retail sector are not signs of an economic downturn, but market course-correction – one that can be seen as an unprecedented opportunity for foreign retailers to break into the New York market at deeply-discounted rental rates and abundant landlord concessions.

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NYRE Journal_11217_Now is the time for global brands to enter the New York City retail market

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.

New York Observer

MAPIC 2017: Retail Headwinds Can’t Cloud the Vibe in Sunny Cannes

At this year’s MAPIC in Cannes, France, there was a mix of concern as well as optimism.

Fred Posniak of Empire State Realty Trust told Commercial Observer that there was “no doom-and-gloom” vibe at the international retail property trade show—and if attendance at MAPIC was any indication, things aren’t so bad. This year’s attendance was up 100 people to roughly 8,500 participants from 2016, according to MAPIC Director Nathalie Depetro. Like last year, attendees hailed from 260 countries around the world.

In New York City specifically, deals are starting up again after a dry spell, as evidenced by the recent transactions involving Levi’s, which is moving its Times Square store to a new 17,250-square-foot location at 1535 Broadway, and Vans, which agreed to take 8,573 square feet for its second Manhattan location at 530 Fifth Avenue.

“I think there is momentum,” said Lee Block of Winick Realty Group.

For more, download the full article in PDF

NY Observer-112017-Retail Headwinds Can’t Cloud the Vibe in Sunny Cannes

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.

Solving complex real estate problems using empirical data and storytelling

Technology has revolutionized the commercial real estate industry, making consumer and market data readily available to brokers and analysts. Real estate professionals can now instantly access data about an area of interest on a level of granularity once thought unimaginable.

This abundance of data has changed how decisions are being made. Locational decisions now require more thoughtful and insightful analyses to satisfy growing demands from clients.

One of the biggest changes I’ve noticed is that clients and investors now expect a greater level of insight into a market. These decision-makers don’t just want data, they want the right data, presented in a way that is highly consumable, relevant, and relatable; that emphasizes traits, characteristics and nuances of a given trade area and marketplace.

The challenge becomes satisfying these needs succinctly, without sacrificing valuable qualities. In this demanding environment, real estate professionals need to bring sites to life by becoming master story tellers.

This is precisely what innovative leaders like Matt Felton of Datastory Consulting and Winick Realty Group have done.

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The Business Journals – 11-14-17 – Solving complex real estate problems using empirical data and storytelling

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.

10 New York Names to Watch

A Single-Sector Expert Diversifies

Founded in 1982 as the second-ever commercial leasing firm solely focused on retail, Winick Realty Group has branched out from leasing— and retail—for the first time. In July, Winick said it had hired David Workman, formerly executive managing director of Savitt Partners, to lead a team that will handle investment sales, office leasing, 1031 exchanges, land sales and a host of other commercial real estate services on a local, national and international basis. Company founder Jeff Winick has been “diversifying the service lines, and they have a stellar reputation in retail,” Workman says. The company is “leveraging amazing relationships” that it has established with clients for which it has done numerous multiple deals. “They really know their stuff. Their platform is about detail orientation: knowing your product, knowing your market and knowing how to put them together.” One result of the relationships that the Winick Realty team has cultivated is the number of off market transactions Workman and his team have handled, whether through assignments brought to them by clients or solutions the team has devised. Workman also cites the analytics and data efforts spearhead by EVP Kenneth Hochhauser as a factor in expanding the 35-year-old firm’s existing service lines.

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real estate forum_september 2017_10 New York Names to Watch

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.

Manhattan Pop-Up Shops Might Be Here to Stay

These days, with the softening real estate industry in Manhattan, stable long-term retail tenants are a scarcity. To compensate, the real estate industry is adapting to short-term tenancies, named licensing deals. Licensing deals allow tenants to use a space rather than own it for a specified time period. The method is being used to rent to pop-up shops in the city. A pop-up tenancy can last from a day up to a year. Both landlord and tenant can benefit because it avoids lengthy legal processes, and bypasses the usual 80- to 100-page lease for a curt version.

It appeals to tenants because it allows them to test the market before tying themselves down and committing for the long run. The owner makes money on the property while it remains on the market for a long-term lease. The tenant gets visibility in the prestigious New York market with very limited risk. The landlord benefits in averting an empty store front, and as a bonus many pop-ups come with celebrity back-up, such as Gwyneth Paltrow and Kanye West, which help endorse the properties.

As per The Real Deal, pop-ups were traditionally seen as short term improvising that landlords and brokers used while waiting for permanent tenants. But some experts say these transactions will become increasingly sought after, as building owners struggle to minimize vacancies in the ongoing battle between brick-and-mortar stores and e-commerce. Currently, less than 15 percent of all retail sales in the U.S. are made online. By 2025, however, it is estimated that one out of every four purchases will be made online, as per a November 2016 report from FTI Consulting. These odds create a daunting reality in which retail stores are increasingly guarded when it comes to signing long term leases.

“Things change so drastically these days, it’s harder for retailers to consider a long-term deal,” says Kelly Gedinsky, Winick Realty Group broker. “Unlike five years ago, landlords are more open to pop-ups because so many [potential tenants] are coming to them and their brokers saying, ‘Look, we want to test this market for a year. If it works, we’d be happy to look into a longer-term deal.’”

Manhattan Borough President Gale Brewer’s office counted 200 vacant store fronts along Broadway this June. She places the blame on high rents, and e-commerce augmented by Manhattan’s pricey commercial rent tax. Between 2010 and 2014, average asking rents in 16 Manhattan strips, as tracked by CBRE, jumped 89.1 percent. It is “an unsustainable situation for some tenants as rents surpassed what their sales growth could support,” says the brokerage firm. Manhattan vacancies have been on the rise since, from a low of 2.5 percent in 2012, to 3.7 percent in 2016, and now 4.2 percent in the first quarter of 2017, according to Okada & Company.

A San Francisco-based website entitled Storefront, lists vacant storefronts allowing potential pop-ups to browse through available spots on a map, by price and square footage, similar to Airbnb or StreetEasy. The site charges a 20 percent fee, and a company rep walks a renter through the process. “We don’t see ourselves as a competitor to the traditional retail market … We just see that space is space,” said Joy Fan, Storefront’s national director. “Vacancies are unfortunate, but the shift needs to happen, so we’re really architecting the next layer of retail for the future.”

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The Jewish Voice-082317-Manhattan Pop-Up Shops Might Be Here to Stay

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.

The UES is facing a retail vacancy epidemic

In the heart of retail’s “Gold Coast” on the Upper East Side, the space that once housed trendy dress shop BCBGMAXAZRIA collects dust. The retailer called the five-story townhouse home at 770 Madison Avenue for over a decade, but shut the doors in February amid a larger corporate bankruptcy. The landlord has yet to find a replacement.

Over on Lexington Avenue, there are four retail vacancies near the corner of East 85th Street. And on the 13-block stretch of 3rd Avenue between East 70th and 83rd streets, there are only two blocks that aren’t marred by at least one empty storefront.

Manhattan’s streets are awash with empty storefronts after retail asking rents climbed to untenable levels and tenants started to push back. But the sheer number of vacancies on the Upper East Side is alarming: The Real Deal counted 82 empty storefronts along Madison, Lexington, Third and Second avenues between 57th and 96th streets during an afternoon in late July.

“That is a lot, and there’s probably 20 percent more that’s on the market,” in terms of space that’s currently occupied and available for lease, said Greg Tannor, a retail specialist who left Cushman & Wakefield in April to join Lee & Associates as a principal.

Third Avenue between East 57th and 79th streets saw the biggest increase in its availability rate during the second quarter among the 11 retail corridors tracked by Cushman. The availability rate rose 7 percent year-over year to 16.6 percent, according to Cushman’s most recent retail report.

And Madison Avenue between East 57th and 72nd streets saw the second-highest increase: a 5.3 percent jump to an availability rate of 23.5 percent, which is the third highest among the corridors the brokerage tracks.

The forces at play are different among Upper East Side’s different retail corridors. Madison Avenue, for example, is one of the city’s premiere luxury shopping strips with asking rents to prove it (an average of $1,431 per square foot).

Over on Third Avenue, asking rents average $283 per square foot, and experts in the area said the avenue’s shops are geared more toward chain apparel stores and national brands due to the kinds of large retail spaces that line the avenue. The struggles faced by national retailers, therefore, are having more of an impact on storefronts on Third Avenue than they would on a tony strip like Madison, brokers said.

“Third [Avenue], I think, is the first market to really struggle with some of the difficulties we’re seeing with national soft goods retailers,” Cushman’s Steven Soutendijk said. “They’re the ones that are struggling in malls across the country.”

In recent months, for example, stores went empty at 1030 Third Avenue when American Apparel closed up one of its last shops following a bankruptcy auction earlier this year. And Reebok left behind and empty storefront at 1132 Third Avenue after shutting down its FitHub location.

By comparison, Second Avenue is considered more neighborhood-focused, geared toward service retail like dry cleaners and restaurants located in smaller stores where top-line rents are more manageable.

Beyond the general woes facing retail, the avenue was long impacted by construction along the Second Avenue subway line, which finally opened earlier this year.

“Certainly, now that the construction has completed, those vacancies should naturally have to fill in,” Winick Realty Group’s Kelly Gedinsky said. “They’re not obstructed by bridges over the sidewalk space anymore.”

For more, download the full article in PDF

THE REAL DEAL_080417_The UES is facing a retail vacancy epidemic

Winick Realty Group is one of New York’s prominent real estate firms specializing in retail leasing and advisory services.  Over the years, Winick Realty has served a broad range of domestic and global clients, with a strong emphasis on long-term representation and expansion and growth strategies.  Winick Realty Group is highly recognized as a forerunner in the retail real estate market.