Insignia/ESG's David Green and C. Bradley Mendelson arranged the transaction on behalf of Boston Properties, while Andrew Mandell and Peter Ripka of Ripco represented Red Lobster. No financial details have been disclosed, but asking rent for the ground-floor space was $325 per sf and the second floor asking rent was $80.
Red Lobster plans a major build-out for the space, according to Mandell. "They're going to add a mezzanine," he tells GlobeSt.com. He adds that improvements include cutting out part of the first-floor ceiling "so when you walk in you're going to have a lot of light."
The space will comprise 3,277 square feet on the ground floor and 11,236 square feet on the mezzanine and second floor. A giant mechanical red lobster will be affixed to the restaurant's exterior.
"The space is generous, highly visible, and an ideal location to attract the busy pedestrian traffic that exists 24/7 in Times Square," says Insignia's Green, who adds that only a space with 6,000 square feet on the ground floor and up to 5,600 square feet on the second floor now remains available at the property. Champs leased more than 10,000 sf in 5 Times Square, known as the Ernst & Young building, earlier this year.
Ripco calls the transaction "the toughest deal I've ever done." He cites "the length of time it took to identify an appropriate site" and the intricacies of negotiating a restaurant deal, as opposed to straight retail, as particular challenges. "There's a flow in a restaurant, where the kitchen is placed, the entrance to the kitchen, where the ventilation comes in. Traditionally you're dealing with a box in the suburbs, a freestanding building. When you deal with an office building it's much different."
Red Lobster is a subsidiary of Darden Restaurants Inc., which also owns and operates Olive Garden, Bahama Breeze and Smokey Bones BBQ Sports Bar restaurants. The company has more than 660 restaurants in the United States and Canada and approximately 70,000 employees.
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