| No question that brick and mortar (especially large scale) is and has been in decline, and no question that some of Times Square rents are driven by branding opportunities, but traffic also drives the crazy prices. (I don't know either way but it would surprise me if most of these stores had been losing money. Plus stores off the photo op part of Times Square - like sporting goods stores on 42- pay high rent too.) My understanding is that a lot of the retail in this ridiculous enterprise is not going to have exposure of any kind, so it must be predicated on foot traffic (and I believe I read that Times Square foot traffic is the heaviest in the US. per sq foot). No question that none of this is "standard model" at all. |
