About 750,000 square feet of pricey retail space is hitting the market in the next few weeks, as the Related Companies formally starts its search for tenants at its Hudson Yards project.
A year after construction started on Manhattan’s Far West Side, and with two major office tenants signed on to the gargantuan project — purse purveyor Coach and cosmetics giant L’Oreal — Related declined to say whether any retail tenants are signed on other than the already-touted Fairway Market.
But brokers say Related, which is partnered with Oxford Properties on the $4 billion venture, is in talks for an anchor tenant such as a department store, and possibly a 60,000- to 80,000-square-foot movie theater. And Related said construction and marketing will begin on the retail space this month.
The goal is for the pricing and mix of retailers to resemble those at Related’s other Manhattan retail behemoth, the Time Warner Center.
Like Time Warner, which transformed Columbus Circle from an open-air head shop to a glassy mall when it debuted in 2003, brokers say Related wants Hudson Yards to do the same for the Far West Side.
Forbes magazine recently dubbed Hudson Yards “the largest real estate project in U.S. history.”
The project, especially the retail portion, is very ambitious given the not-central location. It’s a bit of a push. Residents at Hudson Yards will certainly shop there, but would the tourists too?
A recent exhibit at the Time Warner Center — where renderings of some of the 17 planned Hudson Yards towers are on display — marked the first step in Related’s push to publicize the space, which will not be complete until 2018.
Sotheby’s appears interested, sources say. The auction house put its Upper East Side headquarters, at 1334 York Avenue, on the market in the fall and might be looking to move.
Most important to Related is that Hudson Yards achieves a diverse mix of retail tenants, said Joanna Rose, a spokesperson for the developer. “We don’t want [anything] to be just high-end or just mass-market,” she said.
A similar variety of tenants present at Time Warner Center should consider to have a presence at Hudson Yards as well.
The bulk of the retail that doesn’t go to an anchor will fill out the balance of the seven floors of what Related is calling a “podium,” between 10 and 30 Hudson Yards, located along 10th Avenue between 30th and 33rd streets.
CBRE estimated the total retail for non-anchor tenants in the podium at about 290,000 square feet, but Related would not confirm that figure, insisting that plans are still up in the air.
Dining options, which will also be in the podium, are likewise expected to run the gamut. A concept modeled after celebrity chef Mario Batali’s massive Flatiron District Italian market Eataly, called the Kitchens, will offer prepared foods from different providers.
Under the High Line, along the walk up 10th Avenue to the shiny shopping center, will be Fairway, occupying 48,000 square feet.
The developer is expected to push the envelope on asking prices. Retail rents on par with those at the Time Warner Center would put the ask at $800 to $1,200 per square foot, a hefty sum for 10th Avenue (a discount in comparison to Time Warner is expected).
Some sources say, for example, that rents at World Trade Center reportedly run between $500 and $600 per square foot
In 2011, Crain’s reported that the average tenant at the Time Warner Center was producing $1,600 per square foot per year.
If Related achieves its vision, the entire Far West Side of Manhattan will become a city unto itself.