The Home Depot goes big in Manhattan
Three buildings on the Madison Avenue retail corridor in New York sold recently for 75% less than what they were valued at five years ago. Yet essential goods retailers in need of big, well-located properties in the Big Apple are still willing to pay for them.
Gazit Globe announced that it has signed The Home Depot to the largest retail lease—for both square footage and rent rate—in Manhattan in the last several years. The home improvement giant will leave its long-held Upper East Side location at 731 Lexington Avenue and move into a 120,000-sq.-ft., four-level space on the corner of First Avenue and 61st Street. Construction in the space will begin in 2021. The space is currently home to a Bed Bath & Beyond store, whose lease expires in 2021. (The store was on the list of 60 locations that Bed Bath & Beyond plans to close by yearend.)
“The execution of this lease, at the peak of the COVID-19 pandemic, is an important sign of confidence in New York City and a major accomplishment for all parties involved,” said Gazit CEO Jeff Mooallem. “The property garnered strong interest from a number of tenants at sizable rent increases from the current tenant, even as New York was shutting down.”
Home Depot signed a 20-year lease for the property, which is located one block north of the Queensborough Bridge. Both the landlord and tenant were represented by Peter Ripka of Ripco Real Estate.
“As is so often the case in large retail transactions, the stars aligned to get this done,” Ripka said. “The space is ideal for Home Depot, with large footprints, high ceilings, and excellent loading.”