Thor sells 693 Fifth Avenue for $525M? $3000 PSF Lease?

So... it appears that Joe Sitt just dumped the Valentino property on 5th avenue for $525M after buying it for $142.5M in 2010. I'm perplexed by the ground floor retail lease that got signed with Valentino for $3,000 PSF.

As in $250 PSF per month x 19,600 SF = $4,900,000 in monthly rent? That's $58,800,000 in annual rent.....I understand that urban "high streets" like 5th avenue and Rodeo drive are essentially billboards for retailers but this is madness....Can someone please clarify/confirm this?! Am I missing something here?

See here: https://commercialobserver.com/2016/06/french-bil…

 

Nothing you're missing. See this article: https://commercialobserver.com/2016/05/thor-selling-693-fifth-avenue-at…

According to it, Coach is paying $4,000 PSF for their space on 5th Avenue. Retail on 5th avenue is extremely expensive. Can't comment on if it makes sense for these retailers, nor if CO has the correct numbers, but I would be surprised if these were incorrect. 5th Avenue is pricey.

 

Okay that makes more sense. Still absurd though--I wonder what their sales are like out of that location? They have to be losing money there.

But I guess in the fashion world you're not a flagship brand if you don't have super high end locations? So it is just a "billboard" like I mentioned earlier

I had a flair for languages. But I soon discovered that what talks best is dollars, dinars, drachmas, rubles, rupees and pounds fucking sterling.
 

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