Will it really work?
That's the question some people are asking as the Hudson Yards development comes to life in New York this week.
The retail and restaurant portion of the 18-million-square-foot project opens on Friday, including shops ranging from Louis Vuitton and Neiman Marcus to Lululemon and H&M. Online brands like men's activewear retailer Rhone and shoe maker M.Gemi will find a home there. And eateries include those from celebrity chefs Thomas Keller and David Chang, in addition to local favorites like Blue Bottle Coffee and Shake Shack, and a massive Spanish-themed food hall.
Still, it will take years for the offices and residential high rises around Hudson Yards to fill up, as some buildings in the neighborhood remain under construction, causing traffic jams and the occasional chaos among commuters. So this glitzy mega mall might need a little more time to prove itself. It likely won't be an overnight success.
As long as the blueprints have been coming together, Hudson Yards — at least the one-million-square-foot retail portion of it — has promised to be everything a so-called mall of the future should be. That's as some 1,200 traditional shopping malls across the country — many anchored by struggling department store chains like J.C. Penney and Sears — are undergoing renovations to maintain relevancy, or shutting altogether. Hudson Yards' developers, Related Companies and Oxford Properties Group, in 2010 said they were teaming up to "write New York's next chapter" and build the city's "next great neighborhood." They aspired to create a space for consumers to truly live, work and play — or in this case, shop.
It's the formula many real estate developers hope will save malls across the country. But that was nine years ago, and retail has changed a lot since then.
Other massive retail projects in the city like Westfield World Trade Center and Brookfield Place have watched tenants come and go. Saks Fifth Avenue just moved out of the latter. Neiman Marcus, the anchor department store chain at Hudson Yards, is, meanwhile, caught up in some of its own troubles, with almost $5 billion of debt. And that's as more and more shoppers are opting to browse the internet, for its ease of convenience, instead of department stores. Does New York really need more places to shop?
"If this was just a 750,000-square-foot mall dropped on Tenth Avenue — with just another collection of the retailers you see at a prototypical regional mall — I don't know if you would be able to attract people in a large-scale way," said Michael J. O'Neill, executive managing director of retail services at commercial real estate firm Cushman & Wakefield.