Sellers believe strong anchor tenant could drive premium price in a ‘real test’ for retail by Daniel Geiger
The owners of a corner building and two adjacent retail condos that house the French luxury brand Louis Vuitton in SoHo have put the property on the market in a deal that could fetch more than $80 million.
The ownership group has hired a team from CBRE, led by sales executives Ned Midgley and Ed Goldman, to market the property, which includes 106 Prince St., a 5-story building on the corner of Prince and Greene streets, and the neighboring ground-floor retail condos at 102 Prince St. and 114-122 Greene St.
Together, the spaces total about 21,600 square feet, with about 11,550 square feet of retail on Prince and Greene streets, two of SoHo’s busiest shopping corridors
But the attractiveness of even prime retail space has faded among real estate investors as e-commerce has eaten into brick-and-mortar sales, boosting vacancies and sapping rents. Midgley, however, predicted that 106 Prince St. and the adjacent condo spaces would draw interest because it has a long-term anchor tenant in Louis Vuitton, which has a lease for the entirety of the retail space stretching until 2033.
“There’s a negative sentiment in the market, so this is a real test for retail,” Midgley said. “But with Louis Vuitton, a buyer is getting a great credit tenant and annual increases on the lease that we believe makes this a very attractive deal.”
The luggage brand Tumi currently occupies the retail condo at 102 Prince St., but when that lease expires in a little over two years, Louis Vuitton has an agreement in place to take that space as well.
Vuitton also rents the second floor at 106 Prince St. for a small office. The building’s third, fourth and fifth floors are market-rate rental apartments that command $6,000 a month each, Midgley said.
The current owners are a collection of three Italian families. The group previously tapped Midgley and his team, which also includes CBRE brokers Tim Sheehan and Daniel Kaplan, to sell the property about two years ago, but Midgley said the sellers realized they would face heavy taxes due to their ownership structure. The group delayed a deal in order to reorganize, creating a special purpose holding company based in Luxembourg to control the asset. The sale will be arranged by selling shares in the Luxembourg company. Because a deal will involve the trade of European securities, CBRE’s London office will assist in the sale.