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Was Toys 'R' Us Times Square doomed by high rents?

January 5, 2016Written by Tom Ryan

Toys "R" Us shoppers outside the Times Square store, Thanksgiving evening, 2014. (Photo: Toys "R" Us)

While delivering experiences is often praised as the way physical stores can differentiate themselves from the online experience, two of New York City's most experiential stores — FAO Schwartz and Toys "R" Us' flagship in Times Square — closed over the last year. In both cases, the reason for the closures were the city's escalating rents. FAO Schwartz, also owned by Toys "R" Us and located in the heart of Fifth Avenue across from the Plaza Hotel, closed in July to great fanfare after three decades at that spot. Known for its six-foot stuffed giraffes and danceable piano, the 45,000-square-foot, three-level store grew in popularity after being featured in the 1988 hit film "Big." The Toys "R" Us location, which closed last Wednesday, had only been open for 14 years but also drew tourists and locals to experience its 60-foot-tall indoor Ferris wheel with themed cars, the 20-foot-tall robotic T.rex that swiveled and roared at shoppers, the 4,000-square-foot Barbie dollhouse and other marvels. In 2001, the 110,000-square-foot space across four levels was rented for around $400 per square-foot only a few years after a massive redevelopment had transformed Times Square from a sleazy to family-friendly destination. The 21,000-square-foot ground floor is now being marketed for $2,500 a square foot. Bradley Mendelson, an agent for the building's owner, told USA Today, "Nobody can afford that amount of ground floor space in Times Square." The Gap and Old Navy will take over about 60 percent of the space while Toys "R" Us has vowed to seek out another flagship in Manhattan in addition to F.A.O. Schwartz. Numerous articles detailed long lines in Times Square in the final days by fans looking to recapture past memories while lamenting the loss for the city. Wrote Elizabeth Harris for The New York Times, "New York City is now left without the kind of manifold destination toy store intended to leave every child's jaw on the floor."

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