New York’s retail resurgence from the pandemic's fallout has led to not only a decline in available space, but the coming home of sorts for two iconic New York brands: Brooks Brothers and Calvin Klein.
Two new planned flagship stores from the brands come as retailers have pointed to the importance of brick-and-mortar stores as a key growth avenue and engagement tool with consumers.
Brooks Brothers, the oldest U.S. clothing retailer, expanded from a single shop on Catherine and Cherry streets in lower Manhattan after it was founded in 1818. It will open a new flagship at the redeveloped former AT&T headquarters at 195 Broadway, Brooks Brothers and landlord L&L Holding said in a statement. Under a 10-year lease, the store, spanning 9,871 square feet across a portion of the building’s ground floor and cellar levels, will open in spring 2025.
The Brooks Brothers’ location will be its largest in the city, a spokesperson for L&L told CoStar News, adding that the brand’s last lower Manhattan store at Liberty Plaza closed in 2018. Brooks Brothers currently has two locations in the city, at 1180 Madison Ave. and 1270 Avenue of the Americas, according to its website.
Brooks Brothers, known for its button-down collar shirts and having dressed U.S. presidents including Abraham Lincoln, is now a part of SPARC Group, a joint venture between U.S. mall giant Simon Property Group and licensing company Authentic Brands. The pair bought Brooks Brothers after its struggles during the pandemic led to a Chapter 11 bankruptcy and store closings.
“Since 2021 Brooks Brothers has experienced significant year over year growth,” Brooks Brothers CEO Ken Ohashi said in the statement, adding that the brand seeks to become “a downtown destination for locals and tourists” again.
At the 1.1 million-square-foot, 29-story office tower, spanning the full block from Fulton to Dey streets, Brooks Brothers will count among its office neighbors luxury label Gucci.
For its part, Calvin Klein, a New York label founded in 1968 that turned heads in 1980 for its provocative ad campaign featuring actress and supermodel Brooke Shields, is returning to the city with the planned opening of a 7,294-square-foot flagship store at landlord Shvo's redeveloped 530 Broadway in the SoHo neighborhood, a Shvo spokesperson told CoStar News. The fashion label shut its Manhattan flagship at 645 Madison Ave. in 2019 as the company adopted a “digital-first” strategy, according to media reports at the time. The new store is expected to open by the end of 2025.
Calvin Klein is a part of clothing company PVH after a 2003 purchase. PVH also is the parent of another famed fashion label, Tommy Hilfiger.
SoHo is “one of the best brand-building and foot traffic locations in the world, as part of Calvin's brand-building strategy in key markets,” PVH Chief Executive Stefan Larsson said on the company’s quarterly earnings call Thursday.
Calvin Klein in June opened a flagship in Paris.
To be sure, not all property types are recovering like retail. While Manhattan may be luring global brands to enter or expand in New York, office-dependent retail neighborhoods such as lower Manhattan remain hampered by the slow return-to-office rate, according to a recent study.
Brick-and-mortar traffic
Despite growing online adoption, market research firm Forrester expects by 2028 that online retail sales will remain a minority of projected total U.S. retail sales of $5.8 trillion and grow to 28% of the total by then.
A case in point, Simon Property reported its year-over-year traffic on Black Friday this year rose 5.9% and grew throughout the big shopping weekend, with CEO David Simon saying malls are “thriving.”
Real estate firm JLL said New York’s third-quarter retail availability dropped to a record low, and brands including Japanese apparel seller Uniqlo and luxury labels Prada and Gucci parent Kering have announced purchases of their Fifth Avenue flagships. Louis Vuitton, for its part, is doing a major yearslong renovation of its Fifth Avenue store.
Meanwhile, New York has proved it remains a magnet for foreign brands making a foray in the United States, such as the planned opening in SoHo of Princess Polly, an Australian-born fashion label popular with Gen Z shoppers.
SoHo has led Manhattan shopping corridors in the post-pandemic retail rebound. The average asking rent in the third quarter jumped 19% to $388 per square foot, the fastest growth rate among a dozen areas, according to a Cushman & Wakefield study.
Private-equity firm Blackstone, the world's largest commercial property owner, recently said it agreed to buy a four-property retail portfolio in SoHo.
For the record
L&L Holding was represented in the Brooks Brothers transaction by Alan Schmerzler of Cushman & Wakefield. Brooks Brothers was represented by Eric Gelber and Jordan Kaplan of CBRE.