While the revelers around Times Square screamed as the ball dropped on New Years Eve, more than a few retailers were hoping they'd notice their sparkling, new flagship stores in the area. Daffy's, the women's apparel discount chain, recently became the latest retailer to sign a lease in the revitalized shopping district.
The area in the not-too-recent past had been known for crime, drugs and peep theaters. But a major revitalization during the eighties and nineties has transformed it into a tourist mecca and viable retail destination.
Daffy's, which operates 19 stores largely in the New York metropolitan region, is planning on opening a 28,000-square-foot store on West 44th Street between Seventh and Eighth avenues, the former home of The New York Times, according to Crain's New York. It plans on adding a total of 14 New York-area stores before 2015 with a goal to expand nationally.
An article in The Wall Street Journal said the area has become a "discount fashion center" with Daffy's opening to come after Forever 21 last June opened up a massive 90,000 square feet location in a former Virgin Records location. American Eagle Outfitters, Aeropostale as well as Walt Disney have also opened flagships around Times Square in the past year. In late 2008, Walgreen's opened a location at one Times Square featuring a digital billboard soaring 341 feet above the street on three sides of the building. Other stores in the area include a Toys 'R' Us (including a Ferris wheel), Foot Locker, Modell's, Sephora, Swatch and Billabong as well as attractions such as MTV's studios, Bubba Gump Shrimp and Hershey's.
Retail space in the area now commands an average rent of $1,600 per square foot, up from $550 per square foot a decade ago, Victor Canalog, director of research at Reis Inc., a real-estate research firm, told the Journal.
The Journal article notes that the new retailers cater to tourists "looking for New York fashion at middle-America prices and suburban teens flocking to the city for shopping sprees." Foot traffic from nearby office buildings and new apartments that have been developed in the area in recent years are also supporting retail traffic. About 365,000 people stream through the neighborhood on a daily basis, an 8 percent increase over year-ago levels, according to the Times Square Alliance.
"It mirrors the development of the neighborhood as well as the willingness of retailers to have storefront space in the densest central business district in the country," Mr. Canalog told the Journal.
Discussion Questions: What value do you put on having flagships in major tourist-traffic areas such as Times Square? Which type of retailers benefit most/least from having such as flagship location?