Does Zara Need A $324M Store In New York City?
The space, inside 666 Fifth Avenue, is one of the city’s most expensive retail locations. Until last month it was home to an NBA store, which broke its lease when the building’s property management firm said it wanted $2,000 per square foot in rent. And that’s a lot of money for a store that big. But the company doesn’t seem to be looking forward to the store’s sales so much as what it will mean to have a store in such a prestigious location.
Inditex said it will use the space to open “one of the most emblematic Zara flagships worldwide.” The Spanish behemoth is clearly smitten with the location and the building, which it called “one of the most symbolic in the Big Apple.”
Symbolic, to be sure — and definitely expensive. The location is right across the street from Salvatore Ferragamo and Cartier, and down the road a stretch from ritzy eatery La Grenouille. Uniqlo, another brand that’s trying to position itself more securely in the United States, will open a store right next door to the new Zara outpost in the coming months.
So is this smart business or is it just branding? We’ll have to guess it’s both. But is it worth it to potentially lose money every month on rent just to tell the world you can play with the big dogs?