Lord & Taylor selling flagship Fifth Avenue store to WeWork

Lord & Taylor's flagship store in Manhattan is being sold for $850 million to WeWork, the office space sharing company.

Posted: Oct 24, 2017 10:10 AM
Updated: Oct 24, 2017 5:11 PM

By ANNE D'INNOCENZIO
AP Retail Writer

NEW YORK (AP) - Lord & Taylor's flagship store in Manhattan, known for its holiday displays along Fifth Avenue, is being sold to the office space sharing company WeWork.

The nearly 100-year-old building will be converted to WeWork headquarters, with less than a quarter of the space remaining for a Lord & Taylor store. Right now, 10 of the building's 11 floors are devoted to retail.

WeWork attracts millennials who are looking to share office space, a consumer segment that Lord & Taylor owner Hudson's Bay and other department stores want to attract. So store executives expect the stores to benefit from WeWork members going in and out of the building, and hopes they'll be shopping.

"This is a sign of the future," said Faith Hope Consolo, chairman of the retail group at Douglass Elliman Real Estate. She predicted that other department stores will likely lease some of their space to corporate groups that cater to millennials. "They're building their own traffic generators."

Lord & Taylor will keep the whole building with its usual operations through next year's holiday season. And the holiday displays will go on this year and next year, the company said. It didn't say what happens beyond that. Lord & Taylor was the first to create Christmas windows for sheer entertainment, rather than for selling merchandise. It also pioneered the animated window display back in 1938.

While shoppers may have been drawn to Lord & Taylor's windows, Consolo said she wasn't sure how much they were shopping. Many would buy cosmetics on the first floor but didn't often venture to the upper floors, she said. Hudson's Bay Co., which owns Lord & Taylor, Saks Fifth Avenue and Canada's Hudson's Bay, said in June it was cutting 2,000 jobs in North America as it shaves costs and tries to adjust to changes in how people shop.

The $850 million sale announced Tuesday is part of a plan by Hudson's Bay to pare down debt and reinvigorate sales. Company officials declined to say what the redesigned Lord & Taylor store of about 150,000 square feet will look like.

Richard Baker, chairman of Hudson's Bay, told The Associated Press that WeWork will also lease space in the upper floors in three of the company main stores - Hudson's Bay stores in Toronto and Vancouver, Canada, as well as its Galeria Kaufhof in Frankfurt, Germany.

Department stores have been struggling to follow their customers online, with many closing stores and selling lucrative real estate. Big chains like Macy's had been under pressure from shareholders to get more value out of their real estate holdings. But Consolo agreed with Baker that the Hudson's Bay deal with WeWork is a dramatic change in how retailers are trying to capitalize on their real estate.

"We definitely think there is a future for department stores for people who reinvest in the business," Baker said.

On Friday, Hudson's Bay had said that CEO Jerry Storch would step down at the end of the month.

____

Follow Anne D'Innocenzio at http://www.Twitter.com/adinnocenzio

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 69975

Reported Deaths: 3007
CountyConfirmedDeaths
Marion15152724
Lake7222273
Elkhart468079
Allen3695160
St. Joseph322479
Hamilton2572104
Vanderburgh180013
Hendricks1796105
Cass17609
Johnson1674118
Porter121339
Clark112646
Tippecanoe112311
Madison87265
LaPorte85029
Howard82965
Kosciusko82412
Marshall75222
Bartholomew74947
Floyd72945
Monroe69930
Delaware66552
Dubois65512
Boone64946
Noble63829
Hancock63438
Jackson5564
LaGrange54910
Warrick54030
Shelby53027
Vigo52810
Grant51129
Dearborn47728
Morgan44034
Clinton3883
Henry36519
White34910
Montgomery34321
Wayne33710
Lawrence33227
Decatur32232
Harrison30422
Miami2602
Scott25210
Daviess25119
Greene24034
Putnam2348
Franklin23113
DeKalb2224
Jasper2162
Jennings21412
Gibson2044
Steuben2033
Ripley1947
Perry17212
Starke1707
Orange16424
Fayette1637
Posey1610
Wabash1613
Jefferson1532
Carroll1522
Fulton1502
Whitley1496
Wells1442
Knox1400
Tipton1266
Huntington1193
Washington1171
Spencer1163
Newton11410
Randolph1094
Clay1025
Adams842
Sullivan831
Jay820
Owen821
Rush804
Pulaski751
Brown701
Fountain642
Benton600
Blackford562
Ohio564
Pike500
Parke491
Vermillion470
Crawford440
Switzerland430
Martin420
Union330
Warren191
Unassigned0202

Ohio Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 96305

Reported Deaths: 3596
CountyConfirmedDeaths
Franklin17619517
Cuyahoga13011487
Hamilton9297249
Lucas5114320
Montgomery411485
Summit3399218
Marion290145
Butler277861
Mahoning2470253
Pickaway237442
Stark1756137
Warren168935
Lorain166577
Columbiana160760
Trumbull1465105
Fairfield128529
Delaware124118
Licking117947
Clark110414
Lake106437
Wood97358
Clermont87411
Medina86935
Miami78837
Tuscarawas75914
Portage73460
Allen68242
Greene64411
Belmont59126
Mercer56113
Richland55911
Ashtabula55145
Erie54627
Geauga54044
Wayne51758
Ross4314
Huron3835
Ottawa36525
Sandusky35416
Athens3521
Darke34827
Hancock3443
Madison34310
Holmes3266
Lawrence2340
Auglaize2335
Union2281
Jefferson2122
Muskingum2071
Scioto2041
Putnam19817
Washington19822
Knox1897
Coshocton1866
Seneca1773
Preble1752
Crawford1685
Shelby1684
Morrow1632
Hardin15812
Clinton1546
Champaign1512
Fulton1431
Highland1411
Logan1362
Ashland1353
Defiance1334
Williams1293
Wyandot1287
Brown1201
Hocking1149
Guernsey1137
Perry1133
Carroll1105
Henry1102
Fayette1040
Monroe9118
Pike730
Jackson700
Van Wert701
Paulding640
Gallia621
Adams592
Vinton302
Meigs290
Harrison221
Morgan210
Noble160
Unassigned00
Fort Wayne
Few Clouds
79° wxIcon
Hi: 77° Lo: 53°
Feels Like: 79°
Angola
Overcast
73° wxIcon
Hi: 75° Lo: 53°
Feels Like: 73°
Huntington
Scattered Clouds
75° wxIcon
Hi: 75° Lo: 53°
Feels Like: 75°
Decatur
Broken Clouds
74° wxIcon
Hi: 75° Lo: 54°
Feels Like: 74°
Van Wert
Overcast
77° wxIcon
Hi: 76° Lo: 53°
Feels Like: 79°
Sunny, Pleasant Friday
WFFT Radar
WFFT Temperatures
WFFT National

Community Events