- Vornado’s joint venture is selling 17.3 KSF of Uniqlo’s flagship store at 666 Fifth Ave.
- They will retain ownership of the remaining space occupied by Abercrombie & Fitch and Tissot.
- The sale, expected to close by 1Q25, will generate $340M in net proceeds that Vornado will use to pay down its $390M preferred equity stake.
- The Manhattan retail market was resilient in Q2, with a 14.1% availability rate, the lowest in nine years.
As reported in Commercial Search, Vornado Realty Trust (VNO) will sell a portion of Uniqlo’s U.S. flagship store at 666 Fifth Ave. in Midtown Manhattan. The $350M transaction is set to close by 1Q25.
Deal Details, Impact
Uniqlo, a Japanese clothing company that quickly became one of the world’s most popular brands, will acquire 17.3 KSF of its 90.7 KSF flagship store at 666 Fifth Ave.
A Vornado JV will retain the remaining 23.8 KSF occupied by tenants like Abercrombie & Fitch and Tissot stores. Eastdil Secured provided advisory services for the deal.
The expected $340M in net proceeds will be used to partially pay down Vornado’s $390M preferred equity stake in the asset. Upon completion, the pass-through leases between the office condominium owner and the retail JV will terminate.
Previous Retail Deals
Last year, Vornado agreed to sell a 65 KSF Class B retail property at 510 Fifth Ave. within the Plaza District submarket. Additionally, the company sold four downtown Manhattan retail buildings totaling 123 KSF, and another retail asset in a separate transaction, for a combined $124.4M.
Market Outlook
Manhattan’s retail market remained strong in Q2, supported by steady new leasing activity and tenant expansion. According to Cushman & Wakefield, the Big Apple’s retail availability rate held steady at 14.1%, the lowest level in nine years.
Notably, lower Fifth Ave. availability dropped to 14.8%, the lowest rate since 2012. A significant lease in the area was also recently secured by GU, Uniqlo’s sister brand, for 24.3 KSF at 510 Fifth Avenue.
