NEW YORK — With the rebuilding of the World Trade Center well on its way, the retail scene in lower Manhattan is undergoing a revival.
“It’s taken years for it all to come together, but the downtown retail market is finally moving in the right direction,” said Gene Spiegelman, EVP of Cushman & Wakefield. “I would say every major retail brand is evaluating lower Manhattan in some shape or form right now.”
Driving the momentum are the recent announcements of several blockbuster retail development projects. Most notably, Sydney-based mall operator Westfield Group last month confirmed it will invest $612.5 million in the retail portion of the World Trade Center. In a joint partnership with the Port Authority of New York & New Jersey, Westfield will create roughly 365,000 square feet of retail space within the complex, with an additional 90,000 square feet slated to be added in the future.
Across the street at the World Financial Center, developer Brookfield Office Properties is planning a $250 million retail redevelopment, the centerpiece of which will be a collection of more than 40 high-end fashion shops. Construction is set to begin in October and conclude in 2013. Along the waterfront, Howard Hughes Corp. is spearheading a redevelopment of the South Street Seaport that will encompass nearly 400,000 square feet of retail space. In addition, both the Fulton Street subway station and the new Santiago Calatrava-designed transportation hub at the World Trade Center will add hundreds of thousands of square feet of new retail.
For brands considering lower Manhattan, where retail options have traditionally been limited, a captive audience of consumers awaits. In recent years, downtown has seen an influx of both residents and visitors. The number of people living downtown has more than doubled, to 56,000 since 2000, according to the Alliance for Downtown New York. More than 9 million tourists visited the area last year, and that figure is expected to swell to 12 million by 2012, when the National September 11 Memorial & Museum opens.
“Astute retailers see the opportunities for growth in this underserved retail district,” said Wade McDevitt, CEO of McDevitt Co., Brookfield’s lead broker for its new downtown project.
Also spurring activity are commitments by several high-profile office tenants, among them Goldman Sachs’ relocation of its new headquarters to 200 West St., across from Ground Zero, and Footwear News parent Condé Nast’s leasing of 1 million square feet at 1 World Trade Center.
Already, Hermès, Canali, True Religion and Tiffany & Co. have opened shops in lower Manhattan since 2001. Still, while the downtown market is heating up, retailers are not moving in without some reservations.
“People have a lot of questions, like when to pull the trigger, where the right place to be is, and what the timeline for opening will be. The buildings aren’t finished yet, and there are many other factors in play, so things still have to unfold,” Spiegelman said.