The Giorgio Armani Residences
Hundreds of coops and condos across the city now include street-level retail. While there are obvious advantages to bringing commercial tenants into residential buildings, some commercial tenants make better neighbors, and some coops and condos also make better landlords for commercial tenants. This article examines the history of coops and condos renting to commercial tenants and explores how new construction condo developments are becoming increasingly thoughtful about the commercial tenants they integrate into their buildings.
In this article:
A history of commercial tenants in residential buildings
While New Yorkers have always lived above commercial properties (e.g., in walkups), in such instances, a commercial landlord generally owned the building, and both the commercial and residential tenants were renters. Starting in the 1970s, as more rental buildings converted to cooperatives, it became increasingly common for commercial entities to rent spaces from cooperatives, which essentially turned coop shareholders into landlords. This arrangement, however, ended up posing several challenges, which is why, by the late 1980s, a new structure commonly known as the "condop" had appeared. In a typical condop, the residential units in the building are separated from the commercial spaces, allowing residential shareholders to own the residential part of the building and the building’s original sponsor (or a subsequent investor) to own and rent out the commercial spaces.
On the surface, a coop or condo renting space to a commercial tenant makes a lot of sense. After all, leveraging coveted street-level space is one way to generate income and, in turn, lower fees for tenants while also creating a reserve fund to cover major repairs, such as brickwork. However, these arrangements do require careful consideration.
396 Bleecker Street, #1F (Corcoran Group)
In 1992, The New York Times reported that, in some cases, coops were placing exceptional demands on retail tenants. For example, in the early 1990s, 49 East 86th Street demanded close to $1 million upfront to lease over 3,000 square feet to Williams-Sonoma. The retailer described the lease as “the first deal of its kind for us.” Despite the high upfront cost, the deal was evidently mutually beneficial: While 49 East 86th Street was able to obtain $1 million upfront, which it needed to cover increasing building expenses, Williams Sonoma was able to lease a prime retail space on Madison Avenue for just $50 a square foot, roughly half the average rate for a retail rental at the time. While Williams-Sonoma is likely paying much more today, over 30 years later, they still have a store on the ground floor of 49 East 86th Street.
Although some commercial/residential mixes are mutually beneficial, others are not. A 1995 article in the New York Times, observed, “commercial and retail tenants in a co-op can provide shareholders with a fertile source of cash to offset increasing maintenance costs.” However, the same article cautions, “There are other reasons, of course, to exercise caution when buying an apartment in a building that contains a mix of commercial and residential tenants. Adult bookstores and video arcades just off the lobby, for example, hardly increase the market value of your investment.”
Buildings with coveted commercial tenants and services
Although condos and co-ops have always been selective about their choice of commercial tenants, they were most often added after the fact and not integrated into the building's overall concept. In the case of new construction condos, though, there is a growing trend to bake retailers and services into a building's plan from the start, which can be a win-win situation for commercial and residential tenants alike.
One Wall Street, Financial District
Whole Foods – Opened January 2023
12 availabilities from $895,000
Whole Foods – Opened January 2023
12 availabilities from $895,000
One Wall Street (Compass)
(Whole Foods)
In one of the best examples of the Financial District's transition to a live-work-play neighborhood, the neighborhood's first Whole Foods opened last year. Locals and workers can easily stop by, but the grocery store is just an elevator ride away for residents of One Wall Street. Vintage elements of the original building are on display as shoppers peruse a selection of locally made products.
One Wall Street, #1011
$2,995,000 (-6.7%)
Financial District | Condominium | 2 Bedrooms, 2 Baths | 1,320 ft2
One Wall Street, #1011 (One Wall Street Sales LLC)
One Manhattan Square (Evan Joseph)
Brooklyn Fare (One Manhattan Square)
Finding the right retail tenant can be cause for celebration (Brooklyn Fare opening at One Manhattan Square - Brooklyn Fare)
More than two and a half years after they signed the lease, Brooklyn Fare opened the doors to its largest location yet in One Manhattan Square. This honors Extell's commitment to opening a supermarket to replace the Pathmark that they demolished to make way for the new building, and goes one step further with special perks for residents: They enjoy no delivery fees and a minimum of only $10 on their delivery orders, complimentary coffee on the first day of every month, and access to gourmet culinary baskets from Brooklyn Fare’s catering department.
One Manhattan Square, #12F (Extell Marketing Group LLC)
35 Hudson Yards, Midtown West
Equinox Club and Spa – Opened June 2019
11 availabilities from $5,300,000
Equinox Club and Spa – Opened June 2019
11 availabilities from $5,300,000
Equinox Hudson Yards
At 35 Hudson Yards, the apartments start several stories above an Equinox Club and Spa and SoulCycle. Residents of the condos receive complimentary two-year Equinox memberships and can arrange in-home personal training and spa treatments with the help of the concierge.
35 Hudson Yards, #6604 (Corcoran Sunshine Marketing Group)
Bloom 45, Midtown West
Targer and Bond Vet – Opened April 2021
9 availabilities from $637,500
Targer and Bond Vet – Opened April 2021
9 availabilities from $637,500
Would you like to tour any of these properties?
Just complete the info below.
Or call us at (212) 755-5544
(Bond Vet)
New Yorkers’ love for their pets comes through in buildings’ retail tenants as well as their amenity packages: In addition to including an in-building pet wash station, Bloom 45 counts Bond Vet as one of their retail tenants. They offer everything from annual exams to urgent care. P.S. Those who need to pick up dog food or cat litter at the last minute can run to the Target outpost in one of the building's other retail spaces.
Bloom 45, #610 (Douglas Elliman Real Estate)
The Giorgio Armani Residences (Douglas Elliman)
From the start, the Landmarks-approved 760 Madison Avenue was conceived as a new Giorgio Armani flagship store with 10 luxury condominiums on top. Future resident Mr. Armani has designed the condos' interiors, and residential amenities include a lounge with custom Casa Armani furniture and a Zen tea room with service from Armani Ristorante.
The Giorgio Armani Residences, #8
$23,500,000
Park/Fifth Ave. to 79th St. | Condominium | 5 Bedrooms, 5.5 Baths | 4,530 ft2
The Giorgio Armani Residences, #8 (Douglas Elliman Real Estate)
The Bellemont, Carnegie Hill
Malin + Goetz – Opened January 2024
No current availabilities
Malin + Goetz – Opened January 2024
No current availabilities
The Bellemont (Compass)
Shop interiors (Malin + Goetz)
Given its Madison Avenue address, The Bellemont all but demanded a retail tenant that would fit in with neighboring designer flagships. To that end, beauty brand Malin + Goetz opened its eighth location in the building’s retail space. Anyone who’s ever started the day by using up their cleanser, deodorant, or shampoo can appreciate the ability to quickly replenish it, and the store’s sophisticated interiors and no-fuss layout make that an easy task.
The Harper, Yorkville
Robofun – Opened 2024
10 availabilities from $2,100,000
Robofun – Opened 2024
10 availabilities from $2,100,000
The Harper (CORE Group Marketing LLC)
Closings commenced earlier this year at The Harper, a new condominium in one of the more family-friendly stretches of the Upper East Side. This comes through in the building's offerings: While the art room/maker studio is appealing enough on its own, afterschool creative STEAM program Robofun offers services and events (e.g. birthday parties) to take place there.
The Harper, #12A (CORE Group Marketing LLC)
300 West 122nd Street, Harlem
Lincoln Market – Opened March 2023
5 availabilities from $650,000
Lincoln Market – Opened March 2023
5 availabilities from $650,000
300 West 122nd Street (Douglas Elliman)
(Lincoln Market)
As some speculate that we may be in the middle of a second Harlem renaissance where building is concerned, the neighborhood's supermarkets are on an upswing. Harlem's first Whole Foods opened in 2017, its first Trader Joe's is on the way, and Brooklyn chain Lincoln Market chose it for its first Manhattan location. Residents of 300 West enjoy especially easy access to it, being just a few floors up.
300 West, #6K (Douglas Elliman Real Estate)
Front & York, DUMBO
Devocion – Opened July 2022
23 availabilities from $1,150,000
Devocion – Opened July 2022
23 availabilities from $1,150,000
Front & York coffee shop (Devocion)
At the beginning of every day in New York, the streets are filled with people on the way to get their morning cup of coffee. But residents of Front & York need only take the elevator downstairs. The coffee comes from Devocion’s roastery in Williamsburg, and the space’s industrially inspired interiors and lush greenery makes for an enjoyable atmosphere.
Front & York, #17K-YORK (CIM / LIVWRK)
Brooklyn Point, Downtown Brooklyn
Dekalb Market Hall – Opened June 2017
8 availabilities from $1,230,000
Dekalb Market Hall – Opened June 2017
8 availabilities from $1,230,000
Brooklyn Point (Evan Joseph)
(Dekalb Market Hall)
As Brooklyn Point prepared for initial occupancy, developer Extell announced a partnership with Dekalb Market Hall for exclusive culinary experiences. Indeed, Brooklyn's largest food hall is just an elevator ride away for residents of Brooklyn Point. And for those who'd rather dine in, Trader Joe's also has an outpost in the building.
Brooklyn Point, #42E (Sothebys International Realty)
Would you like to tour any of these properties?
Just complete the info below.
Or call us at (212) 755-5544
Would you like to tour any of these properties?
Contributing Writer
Cait Etherington
Cait Etherington has over twenty years of experience working as a journalist and communications consultant. Her articles and reviews have been published in newspapers and magazines across the United States and internationally. An experienced financial writer, Cait is committed to exposing the human side of stories about contemporary business, banking and workplace relations. She also enjoys writing about trends, lifestyles and real estate in New York City where she lives with her family in a cozy apartment on the twentieth floor of a Manhattan high rise.
6sqft delivers the latest on real estate, architecture, and design, straight from New York City.
