World Trade Center shopping-mall owner Westfield Group is furiously chasing Brookfield Properties in the race to be the king of downtown retail.
Westfield, which controls all the retail space at the WTC, has already lined up retailers for 90 percent of the first sites to come on line — about 360,000 square feet at the 16-acre site, including in the Transportation Hub Oculus and in the lower levels of Larry Silverstein’s office towers two and three, sources said.
Westfield is said to have signed a lease with Victoria’s Secret — and is said to be close to deals with dozens of retailers, including Apple, J. Lindberg, Tory Burch, Theory, Michael Kors, Swatch and Abercrombie & Fitch, as well as several glamorous international brands.
Asking rents are in the $500-to-$600 a square foot range.
Meanwhile, Brookfield, which relaunched the World Financial Center a short stroll west of the WTC as Brookfield Place, has already lured a batch of high-end boutiques including Hermes, Burberry and Salvatore Ferragamo, as Lois Weiss first reported.
Westfield is paying the Port Authority $612 million for a long-term controlling interest in a joint venture for the WTC’s retail. New York dealmakers irked that Westfield handles leasing in-house rather than use outside brokers were nonetheless impressed with its prowess.
Despite skepticism about designers and mass-marketers taking the plunge into untested waters at the WTC, one broker noted, “Westfield has extraordinary leverage over stores which are already tenants in their malls around the US and the world.
“The implied message is, ‘If you want to be at Malls X, Y and Z in the future, we need you at the World Trade Center,” the broker said. “It’s the way mall-owner leasing works.”
Another downtown dealmaker said, “Not all the Trade Center space is in the same demand, but the Oculus is on fire.”
Australia-based Westfield is one of the world’s largest shopping-mall developers, with over 100 centers generating more than $1.1 billion in annual sales. “You’ve never seen a leasing machine like Westfield,” said one retail sage.
But in the short run, Brookfield has stolen Westfield’s thunder.
It had a head start because its 200,000 square feet of shopping and eating space will be ready starting in 2014. The first of Westfield’s eventual 460,000 square feet won’t be open until 2015, or later.
In addition to the boutiques, it’s also signed a big Equinox Fitness club and operators for a 25,000 square-foot gourmet food marketplace and for a 35,000 square-foot dining terrace.
CBRE regional CEO Mary Ann Tighe said FiDi’s swelling ranks of high-income residents guarantees success at both the Westfield and Brookfield projects.
“Think about this simple equation,” she said. “There are 899 new apartments at the Frank Gehry building [8 Spruce St.] and 800 more coming at the Rose Associates conversion of 70 Pine St., plus all the new hotels.
“Where will they all shop? Retail in the area is still very poor.”
Douglas Elliman retail chief Faith Hope Consolo also said there was enough business to go around for both projects. She wasn’t surprised at Westfield’s full-court press. “They want to make sure Brookfield doesn’t eat their lunch,” she said.=