do most businesses in time square new york hemorrhage money?

[cash money 1999]

just looked it up and appearantly its 2,400 a foot

http://therealdeal.com/blog/2013/03/13/times-square-retail-rents-skyrocket-42-percent/

now lets say you have a 1,500 foot starbucks , your rent will be in the neighborhood

of 3.6 million

how do they make a profit? or do they just consider these stores giant billboard adds?

this doesnt even include paying the utilities , up keep , insurance etc

 

[fc1114]

business's

^ Really? Wow :x

 

[cash money 1999]

^ Really? Wow

biznes'z*

 

[putting in work]

I wonder about this too OP

 

[omgitswes]

Larger number of customers coming in and out each day? Or maybe they don't make much of a profit but the fact that the store is seen in Times Square is worth it.

 

[combo gd]

Larger number of customers coming in and out each day? Or maybe they don't make much of a profit but the fact that the store is seen in Times Square is worth it.

What about those seemingly family owned souvenir stores that sell 6 for 10 tshirts? They can't be making that much bank to cover the would be expenses

 

[shotsrangout]

^ Really? Wow

take it easy 

 

[thunderchunk69]

some companies put stores in certain areas knowing they're going to lose money.

it's just good advertisement.

 

[angonas]

That's per year - still an enormous amount, but definitely not monthly.

 

[crcballer55]

Larger number of customers coming in and out each day? Or maybe they don't make much of a profit but the fact that the store is seen in Times Square is worth it.

What I'm thinking. Considering it's one of the most photographed places in the world and numerous news outlets film from there (Good Morning America, MTV, FOX, etc.) make it good business sense for national & multinational corporations to advertise there despite losing money in a single location. It's just one giant billboard that happens to generate some revenue to offset the expense.

That's per year - still an enormous amount, but definitely not monthly.

You sure? I'm no New York Real Estate expert, but only paying $200/sq.ft per month seems REALLY low to me. That's cheaper that residential Real Estate goes for here in California.

 

[fresh out dabox]

Really? Wow

 

[ninjahood]

its probably da most popular street on earth...i aint surprised....

80's time sqaure with da thots & fiends used to be wild wild west

 

[angonas]

What I'm thinking. Considering it's one of the most photographed places in the world and numerous news outlets film from there (Good Morning America, MTV, FOX, etc.) make it good business sense for national & multinational corporations to advertise there despite losing money in a single location. It's just one giant billboard that happens to generate some revenue to offset the expense.




You sure? I'm no New York Real Estate expert, but only paying $200/sq.ft per month seems REALLY low to me. That's cheaper that residential Real Estate goes for here in California.

Yea, I'm in the business of dealing with NNN leases, and it's definitely yearly. $200/sq.ft per month is pretty high. I currently pay rent at two free standing buildings at intersections on high traffic count highways at about $20-$25/sq.ft for 7K and 5K square footage.

One way to be sure is to think of it from the property owners perspective. If the tenant was paying 3.6MM/month as stated above he would be paying roughly 42MM a year in rent. A property owner can expect between 5-10% ROI from a respective lease so with those numbers that would make his property valued at 200-400MM.

Hope that makes sense.

 

[ohmygosher]

Larger number of customers coming in and out each day? Or maybe they don't make much of a profit but the fact that the store is seen in Times Square is worth it.

What about those seemingly family owned souvenir stores that sell 6 for 10 tshirts? They can't be making that much bank to cover the would be expenses

Rent control?

 

[crcballer55]

What I'm thinking. Considering it's one of the most photographed places in the world and numerous news outlets film from there (Good Morning America, MTV, FOX, etc.) make it good business sense for national & multinational corporations to advertise there despite losing money in a single location. It's just one giant billboard that happens to generate some revenue to offset the expense.




You sure? I'm no New York Real Estate expert, but only paying $200/sq.ft per month seems REALLY low to me. That's cheaper that residential Real Estate goes for here in California.

Yea, I'm in the business of dealing with NNN leases, and it's definitely yearly. $200/sq.ft per month is pretty high. I currently pay rent at two free standing buildings at intersections on high traffic count highways at about $20-$25/sq.ft for 7K and 5K square footage.

One way to be sure is to think of it from the property owners perspective. If the tenant was paying 3.6MM/month as stated above he would be paying roughly 42MM a year in rent. A property owner can expect between 5-10% ROI from a respective lease so with those numbers that would make his property valued at 200-400MM.

Hope that makes sense.

True, but I was thinking of it more from a billboard standpoint more so than a retail standpoint. I know McDonalds owns most of their locations, so it's not inconceivable to think that they would be willing to lose money on one to make it up for their other 10,000

Thanks for the clarification.

 

[rodrigofresh]

Just to be there, I know a ton of places over there plan to lose each year, or just be unprofitable. Like someone else stated there is so much media there, so thats exposure.. . I was watching Catfish on MTV and they have like a reunion thing like after each episode... Well you see Footlockers store front logo across the street in EVERY episode.. so that hits for every other series they film there too. 

 

[essential1]

350,000 people visit Time Square each day on average..

A 30 day month will see around 10,000,000 people in Time Square.

They probably lose money, but it's a drop in the bucket.

 

[jthagreat]

Larger number of customers coming in and out each day? Or maybe they don't make much of a profit but the fact that the store is seen in Times Square is worth it.

What about those seemingly family owned souvenir stores that sell 6 for 10 tshirts? They can't be making that much bank to cover the would be expenses

Rent control?

that was my og thought as well...similar (not bringin him up for debate) but Ninjahood's rent control/grandfathered price deal.

 

[Bert.]

3.6 mill a month... for rent?


OP what are you talking about...

its a year if anything plus lots of profit if the place is good. look at how many people walk the area all day everyday.

 

[joepac12]

A better question is how them kiosks in the middle of the mall pay their rent of 3000 and up. Fake glasses and helicopters can't pay the bills

 

[al audi]

its probably da most popular street on earth...i aint surprised....

80's time sqaure with da thots & fiends used to be wild wild west

i was born in 85 so i dont recall much of the 80s


times square in the 90s...............lol man

youd a thought HO'n in the streets was legal

 

[ninjahood]

its probably da most popular street on earth...i aint surprised....

80's time sqaure with da thots & fiends used to be wild wild west

i was born in 85 so i dont recall much of the 80s


times square in the 90s...............lol man

youd a thought HO'n in the streets was legal

video games in da 80's was a reflection of da REAL culture out there....double dragon, final fight, streets of rage, etc.

all time square was a hoodlum playground with 99 cent grindhouse triple feature movie theaters, chicks dressed like dominatrix selling

da bunz, porn and *****z houses, crime, arcades, drugs, and tourists till..

 

[tomdiginson]

I dont think the rent is that high

 

[jjs]

One of my boy was talking to people in the footlocker in Time square and it's such a big volume that they can rack up 100k in sales in one day and it's no big deal. The money these stores make is incredible. I have to say that rent is crazy though :x