The decision by luxury retailer Neiman Marcus to open its first store in New York City was not taken lightly, CEO Karen Katz told CNBC on Friday.
The 250,000-square-foot, multilevel location is scheduled to open in 2018 as part of the new Hudson Yards development project, located between the neighborhoods of Hell's Kitchen and Chelsea on the West Side.
"We weren't in pursuit of a location in Manhattan," Katz said in a "Squawk Box" interview. "Initially I was skeptical," adding the company already had an amazing Fifth Avenue location for its high-end Bergdorf Goodman store.
But she said: "Once we dug into the demographic shifts in Manhattan and what's going on [in] the western and southwestern part of the city, we became very, very intrigued."
"There has been a tremendous shift from the Upper East Side—where people want to go or where your highest prices are—to that area," said Stephen Ross, chairman and founder of Related Cos., the real estate powerhouse developing Hudson Yards. "There was like a perfect storm. The city and state spent tremendous amounts of money. And if you follow the money, this is where the growth is going to occur."
In addition to a Neiman Marcus store, Related Cos. said the Hudson Yards site will feature more than 100 other shops and restaurants, five office towers and about 5,000 residences. There will also be 14 acres of public open space, a public school and a luxury hotel.
"With Hudson Yards, we were able to create a city within a city," said Ross.
—By CNBC's Matthew J. Belvedere