News Feature | August 29, 2013

Nordstrom Pays $102.5 Million To Own Skyscraper Retail Space

Source: Retail Solutions Online
Sam Lewis

By Sam Lewis, associate editor
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Retailer’s flagship Manhattan store to debut in 2018

Seattle-based Nordstrom appears to be growing some roots in Manhattan, as the retailer acquired space in the property located at 225 West 57th Street for its flagship, and only, NYC store. The building will open in 2018 and Nordstrom will occupy the first seven floors of the 88-floor condominium tower. The new building will stand at 1,550 feet, making it nearly as tall as One World Trade Center (speculated to be 1,776 feet) which opens in 2014, and surpassing the Empire State Building at 1,454 feet.

Mayor Bloomberg announced Nordstrom’s plans last June at the company’s Soho retail space, which has subsequently closed to make room for the new development. The new store’s seven floors will occupy 175,000 square feet, but Nordstrom reported earlier it would span 285,000 square feet. It’s unclear if the larger figure represents the inclusion of additional facilities like mechanical rooms. The price translates to $586 per square foot of the retail space, which Nordstrom says was used as a down payment to maintain control of the building. If something were to go awry in the current development of the land and building, Nordstrom is assured that it cannot lose its stake in the venture.

Last week, the site’s developer, New York realtor Gary Barnett, purchased the final piece of land for the site with $102.5 million from Nordstrom. The final piece was the Beethoven Piano Building at 223 West 58th. The building, which is only 20 feet wide, was purchased by Barnett for $25 million. Carl Demler, Beethoven Piano Building’s owner, was reluctant to give up his space. The combination of prime real estate and Demler’s stubbornness led to the high price for the small building. Demler is currently trying to buy a building across the street from his former location.

As of today, New York City’s Buildings Department has not offered approval for the new building. “We are simply going through the natural evolution of the design of the building, and we are still developing the necessary plans for approval,” a spokesperson for Barnett said.