Sidebar Sidebar
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.

Apple's Grand Central Terminal Store Opens December 9th, State Probing Lease Deal

Shrink said:
Lucky thing no Republicans ever hype some relatively trivial story to garner cheap, high profile news stories. I know they're too morally upstanding to stoop to such low tactics. :D

It's only those dopey Democratic politicians who work the media for their advantage. Darn them for such crummy tactics.:rolleyes: ;)
Click to expand...

Republicans are equally guilty in other locales. In NY, the Democrats have it locked up. Try not to get your panties in a wad.
 
gnasher729 said:
Let's say someone in the state of NY figures out that the contract is too generous to Apple. And they want more money. Doesn't matter. The contract is signed. If they want out, Apple will probably allow them to cancel the contract as long as they pay Apple back all the money that Apple invested. And then someone will figure out that this is a very, very expensive plan.
Click to expand...

What would happen is Apple would get to keep their contract but the MTA would get screwed by the media for mismanagement. It's the MTA's responsibility to act in the public's best interests, not Apple.
 
Sounds like the state should ininvestiage the Metrazur lease first.
If Apple's deal is so great, what does that make the Metrazur lease?
 
I love the way the 'Arriving' sign mimics the kind of train & transportation signs you may have seen around a busy station such as Grand Central. Very cool and a nice Apple touch. :)
 
DiNapoli should research the phrase 'Anchor Store and their benefits' and see how often a major name is given special deals to come to a Mall so as to increase over all traffic from which all other stores gain business.
 
Mak47 said:
So because the MTA "Ripped off" the taxpayers by signing a legally binding contract that is most likely irrevocable--the state government will spend more taxpayer money investigating it.

Nevermind the fact that at Apple's average of $5600 per square foot of revenue, this 23,000 sq foot space will generate over $11 million dollars in sales tax revenue alone for New York each year. That's around $478 per square foot if you're doing the math.

The simple fact is that Apple's stores generate exponentially more revenue than any other retail operation that would open there. The MTA could have paid Apple $50 per square foot to take the space and still come out ahead for New York. That doesn't even account for the boost that other retailers will see on top of what comes directly from Apple.

There is a reason why politicians run for office instead of running businesses or doing real work. They are incapable of it, and this is a shining example.
Click to expand...


I think it's yet to be seen whether MTA made a bad deal. It's quite common for malls to give the anchor stores (typically big department stores) more favorable leases than the smaller stores because it's the anchors that attract the bulk of customers to the mall who then shop at the other stores. Ever seen a mall where an anchor moves out? Usually that wing of the mall goes dead until a new anchor moves in. And the quality of the shoppers depends on the quality of the anchor.

I'd bet Apple will generate more revenue for the state in Grand Central, but we'll have to see. But right now MTA did not, defacto, make a bad deal here.
 
Mr. Gates said:
The new iPhone is down that hole !


82046384.gif
Image
Click to expand...

That was my neighbor! :eek:

;)
 
Typical grandstanding of State officials. This is just to create an opportunity for State officials to look like they are flexing their muscle since they don't know a thing about pricing of real estate leases.

How much space did Apple take? 10,000 square feet is their typical store and how much space is the burger joint taking, 1200 square feet. Apple is an anchor at all retail centers and they drive foot traffic to the center that benefits all the other tenants. Every retail center will bend over backwards for an Apple store because now all of a sudden the retail center will become a premier retail location instead of a 3rd rate center it was before Apple signed the lease.

In some cases the landlord will also contribute for the cost of Apple's tenant improvements up to $60 per square foot. I say the MTA got a deal if Apple signed a 10 year lease and paying their own tenant improvements.
 
Ca$hflow said:
Why the hell is the state getting involved. Are they looking at creating some sort of price fixing? If apple payed for something over priced they wouldn't have cared. The state wants profit sharing? Why? What did the state do to justify profit sharing? They are overspending the way it is. Perhaps that's why their sniffing around for money. We so need less government.
Click to expand...

I'm the last guy to defend the actions of politicians, but retail store "profit sharing" is actually a standard element of many retail leases, especially in malls and other high traffic venues like stadiums, airports, etc. The "profit sharing" is really "revenue sharing" where the retailer agreed to pay a percentage of sales (typically above some agreed benchmark level) to the property owner. So in this case the State is only looking for something that is standard practice and Apple is likely paying in many of its mall based locations already.
 
jmgregory1 said:
In the retail market,
Click to expand...


I was just having this discussion with someone this morning. Having been a party to many retail and office leases over the years, there is no fairness there. Everyone tries to get the best deal they can get and everyone is not treated equal.

Take a typical shopping center with a grocery store tenant. The grocery store anchor is going to get all kinds of concessions and benefits the dry cleaner has no chance at all of seeing. It is the way it works. If someone is unhappy with their lease, it is on them and their ability to negotiate a deal.

If the owners of GCS are upset about the revenue that is on them. I don't know if the state owns them or not. If they do not, then I do not understand their involvement at all.

Many other tenants there will benefit from Apple's presence and Apple will raise a ton of Sales tax as well.
 
gnasher729 said:
Let's say someone in the state of NY figures out that the contract is too generous to Apple. And they want more money. Doesn't matter. The contract is signed.
Click to expand...

True...but just because a contract is signed does NOT mean it cannot be deemed null and void. There are thousands of "contracts" people sign every year, go to court, and the court finds the contract was never valid to begin with. Heck, I've signed a few in my life that I knew wouldn't hold water in any court...but they were more for the warm and fuzzy "ah, we have a committment here".

I'm not saying that will 100% be the case...but contracts can be overturned...especially government contracts that have been found to be illegal. Heck, all the folks who negotiated it could simply be fired.

It's hard to believe that this "contract" did not seem so 1-sided to the MTA. Taxpayers will be extremely upset.
 
This is a tempest in a teapot. Apple got a good lease deal because it will bring more people into the station. Period.
 
In a few quarters, when the retail income of Apple and surrounding tenants is established, some bright politician will calculate the sales tax increase generated by this deal and take credit for it - just before an election.
 
I worked as a retail consultant for local goverment. At one point, a major Big Box High end clothing Retailer wanted 20 million in cash, just to move in. The city paid for it knowing that that box would bring in a huge amount of foot traffic. This is common practice.

Nothing to see here. Move on.
 
Issue is no matter what it sets a bad precedence. Doesn't matter who the client is it comes across as "corrupt" to make these types of deals. Who foots the extra costs? Usually us the tax payers.
 
ivladster said:
That store is looking so weird in that place. It looks out of place without apple's glass, metal walls and concrete floors. I hope they make it more appealing.
Click to expand...

Is it even possible to offer an opinion with less basis in reality?
Try going to it instead of judging from bad photos.
I'm willing to bet that it's gorgeous.
 
Ca$hflow said:
Why the hell is the state getting involved. Are they looking at creating some sort of price fixing? If apple payed for something over priced they wouldn't have cared. The state wants profit sharing? Why? What did the state do to justify profit sharing? They are overspending the way it is. Perhaps that's why their sniffing around for money. We so need less government.
Click to expand...

Welcome to a real taste of NY! Politicians in this state don't think they way this guy (or any other logical person) does:


Mak47 said:
Nevermind the fact that at Apple's average of $5600 per square foot of revenue, this 23,000 sq foot space will generate over $11 million dollars in sales tax revenue alone for New York each year. That's around $478 per square foot if you're doing the math.

The simple fact is that Apple's stores generate exponentially more revenue than any other retail operation that would open there. The MTA could have paid Apple $50 per square foot to take the space and still come out ahead for New York. That doesn't even account for the boost that other retailers will see on top of what comes directly from Apple.
Click to expand...
 
You must log in or register to reply here.
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.
Top Bottom
Back