"The retail world has just evolved in such a way that Stern's' market share has reduced so much that there is nothing that separates Stern's from other retailers that justifies its existence as a stand-alone entity," theorizes Jonathan Mechanic of Fried, Frank, Harris, Schriver & Jacobs.
"The closing of Stern's was just a function of their business, and the space that they are now vacating at the Manhattan Mall will lend itself very well to several big-box users," adds Cliff Molloy, director at CB Richard Ellis. In total, Stern's will close 24 stores in New York and New Jersey, totaling 4.8 million sf, most of which will be converted to a Macy's or a Bloomingdale's.
Where does this leave the Manhattan Mall? "When Stern's came in the mall, it was in transition," answers Robin Abrams, executive vice president at Lansco. "Stern's didn't have the name value to hold it together in this location."
"Now there have been talks to put two or three larger users into that Stern's space," continues Abrams. "And the other smaller spaces that have been vacated by the boutiques should go to other chains like Children's Place, which has a strong store there, or KB Toys, also strong."
With the influx of nationals like Old Navy, H&M, Parade of Shoes, Aldo's Shoes, Zara and others taking space in that neighborhood, the area is picking up. The Gap's strongest store nationally, according to Abrams, is sited near the mall at 34th St.
"The first through the third floors of the mall have been very successful, but the other floors have been very problematic based on how they were tenanted," adds Abrams. She expects Argent to ask about $70 per sf for the Stern's space, but she's not optimistic that they will get that rate.
Retailers in the mall are confident that a strong anchor will come in. Rumors have been floating that Target and Home Depot have been eyeing the space, but ownership would not confirm the speculation.
For a report on Stern's closure strategy, click on:Stern's Shut-Down Is Last Phase of Federated/Macy's Merger
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