The impact of the closures on the New York City retail market is uncertain, but the chain has a significant presence in the boroughs, leaving behind several large blocks of space. Daffy’s recently opened a massive 17,000-square-foot store at 218 W. 44^th St. in Times Square at rents near $1,400 a square foot, and also has locations at 1311 Broadway in Herald Square; 3 E. 18^th St. in Midtown South; 335 Madison Ave. in the Grand Central submarket; 125 E. 57^th St. in Midtown East.; 1775 Broadway in Midtown West; 462 Broadway in SoHo, 50 Broadway in the Financial District; Atlantic Terminal in Downtown Brooklyn; and 88-01 Queens Blvd. in Elmhurst, Queens.

Gene Spiegelman, executive vice president at Cushman & Wakefield, tells GlobeSt.com that the Daffy’s store closures will provide landlords with the opportunity to recapture ground floor space and reposition the real estate at a higher value. “They are located in really excellent located positions, and they are actually going to free up some spaces that will help landlords reposition some buildings,” he says, noting that the ground floor space at 125 E. 57^th St. is already available, and now with Daffy’s coming on-line, the landlord will be able to reposition all levels of the building, from ground, basement and mezzanine. “It’s something that the landlord always had a desire to do. Daffy’s exercised an option in that building some years ago, so I think that’s going to bring the opportunity to really reposition that whole corner.”

And like the 57^th Street space, Spiegelman adds that the Daffy’s locations coming on the market at 335 Madison Ave. in Midtown East and 3 E. 18th St. in the Flatiron District would be highly sought after as well. “If you look around Midtown, how many blocks of space of that size are available? The answer is very few, so it just offers another opportunity for other retailers to step in and for the landlord to reconfigure the space,” he says.

Faith Hope Consolo, chairman of retail leasing at Prudential Douglas Elliman, tells GlobeSt.com in an e-mail that since Daffy's isn't liquidating through Chapter 11, it retains control over its real estate.

“I wouldn't be shocked to see TJMaxx take some of the locations," she says. "Marshalls and TJMaxx really killed the chain. That's the easy way into SoHo or the Grand Central area, for example," she adds, noting that TJMaxx is on Wall Street and East 59th, and Marshalls is on West 57th, and both are near Union Square. "But they could use a couple of the other sites easily. Or add HomeGoods in a couple of the locations close to existing stores. This could be a real opportunity for this company."

The first Daffy’s store – once called "Daffy Dan’s Bargain Town" – opened in 1961 in Elizabeth, NJ by retailer Irving Shulman. From there, the family-run business expanded beyond New Jersey into new markets, but reports show that the company had recently failed to pay its vendors.