I wish NYC was its own state, we do not need upstate. Keep the neo-cons out of our business.
I think your nasty political views are not welcome here. Go away.
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Apple's Grand Central Terminal Store Opens December 9th, State Probing Lease Deal
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I wish NYC was its own state, we do not need upstate. Keep the neo-cons out of our business.
I think your nasty political views are not welcome here. Go away.
Trust me, no matter what label comes after Bloomberg's name, he is unquestionably a Democrat.
Your response shows your lack of knowledge of both the law and retailing. It would be tough to prove the lease was an illegal contract. Maybe you could do that with ease in a 1L contracts exam but not in real life.
And as for Apple not being a anchor because of the "limited" market, you don't seem to understand the definition of an anchor store. An anchor is any store that draws in a large amount of people. Beside Apple being one of the most loved brands in the U.S. it's stores are often the only one with a large amount of people in it, even during the holiday season. If that isn't an anchor then all my retail real estate knowledge is for naught. Geez, everyone and their mom has an iPad, iPhone, or iPad. Some limited market! Anchors frequently get below market leases and avoid a gross sale and percentage clause.
So you want to pull $30 Billion out of Apple?
It isn't Apples responsibility to fix the MTAs problems. Nothing Apple could reasonably pay would impact that $30 billion.
In any event this part of your post highlights the free ride mentality of NYC dwellers. You simply don't know what the real costs of services that you use are because you expect someone else to underwrite those services.
The problem is there isn't even enough evidence of wrong doing to even suggest an investigation. So what we have is public grandstanding which benefits no one besides a few politicians.
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As to Tennessee have you stopped to consider that state recently? It is in far better shape than NY in many ways.
It isn't Apples responsibility to fix the MTAs problems. Nothing Apple could reasonably pay would impact that $30 billion.
Being funded by the tax payers is a huge problem and frankly is one of the things upstate NYers get really pissed off about! Any and all transportation systems should be supported by the users and nobody else. If the fees end up to high it is about time NYC folk learn to walk. Like it or not the MTA is part of the welfare state mentality. A mentality that says no body needs to take responsibility for themselves or the activities they engage in.
Obviously they haven't increased fares enough nor laid off enough people.
That is simply ignorant. It is the responsibility of the users of the transportation system to pay the fees to make it viable. You can't possibly believe that any tenet in that space would pay enough in rent to put a dent in that $30 billion shortfall. As to the legal standards please tell us where they went wrong?
In any event this part of your post highlights the free ride mentality of NYC dwellers. You simply don't know what the real costs of services that you use are because you expect someone else to underwrite those services.
The problem is there isn't even enough evidence of wrong doing to even suggest an investigation. So what we have is public grandstanding which benefits no one besides a few politicians.
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He is in every shape and form a Democrat.
As to Tennessee have you stopped to consider that state recently? It is in far better shape than NY in many ways.
The city/state is stealing money from its residents and this happens? Heads will roll.
And yeah, the city hasn't had a Democratic mayor since the early 1990s... could you imagine how much worse it would've been had Rudy not bleached this place?
And yeah, the city hasn't had a Democratic mayor since the early 1990s... could you imagine how much worse it would've been had Rudy not bleached this place?
I don't agree with his social policies, but fiscally he's very good. After all, he did build a tremendous business before entering politics.
Where have I been nasty?
This thread highlights in very stark terms just how screwed up the mind set is in the NYC area. The MTA offers a major brand a reasonable deal and people immediately start to whine about how unfair it is. All this talk about balancing that budget problem at the MTA just highlights how out of touch with reality people are in NYC. The only reasonable course of action for the MTA to solve its problems is to start charging its users a sensible fee to cover expenses. The reality is they simply don't have the retail floor space to put a dent in that budget from renting to businesses.
None of the views expressed above are nasty in the least. They do cause some people discomfort though and that is a good thing.
Nothing I've sad has been nasty in the least bit. Rather it reflects reality, NYC is a massive sink of public money. It is an environment that supports the lazy and hanger ons. The political situation there is appalling in its corruption and self centeredness. This isn't even disputable anymore.
This thread highlights in very stark terms just how screwed up the mind set is in the NYC area. The MTA offers a major brand a reasonable deal and people immediately start to whine about how unfair it is. All this talk about balancing that budget problem at the MTA just highlights how out of touch with reality people are in NYC. The only reasonable course of action for the MTA to solve its problems is to start charging its users a sensible fee to cover expenses. The reality is they simply don't have the retail floor space to put a dent in that budget from renting to businesses.
None of the views expressed above are nasty in the least. They do cause some people discomfort though and that is a good thing.
So you're suggesting unless the dollar amount of a single MTA project is large enough to raise fares, the Comptroller should ignore it? Or that taxpayers shouldn't care how their tax dollars are spent if it's under a certain threshold? BTW a utility fare or rate hike is rarely caused by a single project in the first place. Since nothing by itself is big enough to make a difference, maybe watchdog groups should just ignore everything then.
You also ignore the fact that if the MTA didn't follow the proper bidding process the MTA opens itself up to being sued up the ass and taxpayers will end up paying the bill. This is what the Comptroller is really going after. Contrary to the people in this thread who are butthurt because they think NY state govt is launching an attack on Apple, the Comptroller doesn't care about Apple. He's auditing the MTA to make sure they followed process. That's his job.
I never said that, you're making that up. My point is it's the MTA's responsibility to adhere to process when it comes to awarding contracts and have the public interest in mind.
Or maybe they're also pissing away money due to bad management decisions. And if you live in NY, it's your money they're pissing away, not theirs.
Legal standards = there's a bidding process for govenrment. You rarely hear the word bid in private contracts because if I own company A and want to make an exclusive deal with company B, I can target them and make the deal. In government, for the sake of fairness, I have to give everyone who qualifies an equal shot at my contract, not just the company I want. If the Comptroller finds proof the MTA followed the proper bidding process and everything is justifiable, it won't matter if Apple paid $200 or $5 per sq ft.
I live in LA with crappy public transit so I don't have any NYC mentality. And your small govt rant has nothing to do with any of this.
dude- your posts are so ignorant and uncalled for. are you bitter because of the terrible upstate economy? its not downstates fault all of the business is here. people and business want to be in NYC. dont worry - you've been reported. please go somewhere else - fox news, your militia forums whatever.
Using the NY Post as a reliable news source? really?? This is the same paper they had a hard time giving away on the street
In other front page news for this quality journalistic establishment .. Kim Kardashian is on the Australian Immigration watch list, Scarlett Johansen is jealous of Blake Lively, and Vinny from the Jersey Shore is convinced he's getting a bad rap .. what's next - FUD apple reports from Fox and Friends or Hannity? If all you want to do is create a spirited debate about NYC gov't and policies - you might as well take reference quotes from the occupy wall street folk ..
In other front page news for this quality journalistic establishment .. Kim Kardashian is on the Australian Immigration watch list, Scarlett Johansen is jealous of Blake Lively, and Vinny from the Jersey Shore is convinced he's getting a bad rap .. what's next - FUD apple reports from Fox and Friends or Hannity? If all you want to do is create a spirited debate about NYC gov't and policies - you might as well take reference quotes from the occupy wall street folk ..
Great Deal for MTA
MTA now is making over $1M more per year in rental income and has an Apple Store that will bring in more customers then Metrazur's. In addition Apple paid to get Metrazur out of the complex, Apple paid for all the alterations to their space, they are even adding an elevator at Apples expense to the facility. Its hard to imagine explaining to someone that a deal that cost the MTA nothing (no buyout, no space upgrades, no loss of revenue) and now pays them over $1M more per year for the next 10 years and will bring lots of additional people to the other stores is 1 sided against them. They keep throwing out that the Shake Shack pays $200 a Square foot, all while not telling you that it isnt signing a 10 year contract, which is part of the reason it paying alot more per square foot, and they are skipping over the MTA having to carry out renovations to the space for the little restaurant before they would move in.
MTA now is making over $1M more per year in rental income and has an Apple Store that will bring in more customers then Metrazur's. In addition Apple paid to get Metrazur out of the complex, Apple paid for all the alterations to their space, they are even adding an elevator at Apples expense to the facility. Its hard to imagine explaining to someone that a deal that cost the MTA nothing (no buyout, no space upgrades, no loss of revenue) and now pays them over $1M more per year for the next 10 years and will bring lots of additional people to the other stores is 1 sided against them. They keep throwing out that the Shake Shack pays $200 a Square foot, all while not telling you that it isnt signing a 10 year contract, which is part of the reason it paying alot more per square foot, and they are skipping over the MTA having to carry out renovations to the space for the little restaurant before they would move in.
Doesnt really work quite like that.
There isn't a bidding "process" in this case, because noone wanted 1 large piece of the property and the other piece was already rented. The comptroller is puffing up and acting big, but even with what we know, its pretty easy to see that its a good deal for MTA. Rental income for the property is now up $1M a year. Costs for this to occur $0, all modifications (including an elevator, and the exit fee for the previous tenant) were paid for by Apple. Getting a company to give you a 10 year lease in this economy is also a great move, store turnover is high at retail outlets now, 10 year contract with the largest company in the world with $1M dollars in increased revenue pretty much a slamdunk win for MTA.
There isn't a bidding "process" in this case, because noone wanted 1 large piece of the property and the other piece was already rented. The comptroller is puffing up and acting big, but even with what we know, its pretty easy to see that its a good deal for MTA. Rental income for the property is now up $1M a year. Costs for this to occur $0, all modifications (including an elevator, and the exit fee for the previous tenant) were paid for by Apple. Getting a company to give you a 10 year lease in this economy is also a great move, store turnover is high at retail outlets now, 10 year contract with the largest company in the world with $1M dollars in increased revenue pretty much a slamdunk win for MTA.
Can you name a single major public transportation system that fully supports itself without subsidy of any kind? Every system I've ever looked at, including road, rail, and air, have all been subsidized in one way or another.
So lets say Apple did get a killer deal on the lease, somehow 'unfair' to other tenants who are paying more.
It's still a business move for the MTA. It's not uncommon for a shopping mall to undercut it's leases to get an Apple store in, so why wouldn't MTA do the same? The idea being that the MASSIVE amount of traffic the Apple store gets will inevitably mean traffic for other stores as well. Call it whatever you want, but Apple stores, all of them, draw huge crowds. There are three malls within an hour of me, one of them has an Apple store. It's the second smallest of the three in terms of physical size (the mall is) and number of stores, yet it is EASILY the most crowded, and it has the most parking, but it's impossible to find a spot. The other two are very lax and not too busy. Why? Because there are quite a few folks who, give the decision, will go where the Apple store is, even if they aren't gonna buy anything, just so they can go play with the gadgets and make funny faces at photobooth.
I can just about guarantee that Apple store is getting a deal on it's lease, with how much foot traffic they get, ALL of the stores in that mall benefit. For one, at the other two, you can walk right up and grab a bite to eat at the food court, at the one with the Apple store, you'll be waiting for a while. So the food court folks are definitely benefiting at the very least. (By the way, two of the three are right off of a major interstate, the other one is only about 1/4 mile from the interstate, so it's not location. In fact the one with the apple store is actually a bit farther away from St.Louis than the others.)
Retail space has a serious turn over, and contracts are usually relatively short. As the traffic from the Apple store increases, so does the price of rent for all of the other spaces. It's a win-win.
It's still a business move for the MTA. It's not uncommon for a shopping mall to undercut it's leases to get an Apple store in, so why wouldn't MTA do the same? The idea being that the MASSIVE amount of traffic the Apple store gets will inevitably mean traffic for other stores as well. Call it whatever you want, but Apple stores, all of them, draw huge crowds. There are three malls within an hour of me, one of them has an Apple store. It's the second smallest of the three in terms of physical size (the mall is) and number of stores, yet it is EASILY the most crowded, and it has the most parking, but it's impossible to find a spot. The other two are very lax and not too busy. Why? Because there are quite a few folks who, give the decision, will go where the Apple store is, even if they aren't gonna buy anything, just so they can go play with the gadgets and make funny faces at photobooth.
I can just about guarantee that Apple store is getting a deal on it's lease, with how much foot traffic they get, ALL of the stores in that mall benefit. For one, at the other two, you can walk right up and grab a bite to eat at the food court, at the one with the Apple store, you'll be waiting for a while. So the food court folks are definitely benefiting at the very least. (By the way, two of the three are right off of a major interstate, the other one is only about 1/4 mile from the interstate, so it's not location. In fact the one with the apple store is actually a bit farther away from St.Louis than the others.)
Retail space has a serious turn over, and contracts are usually relatively short. As the traffic from the Apple store increases, so does the price of rent for all of the other spaces. It's a win-win.
Let's see.... The former tenant was paying $15 per square foot and had EIGHT YEARS remaining on their lease. So the MTA would have made $15 per square foot on that space for EIGHT MORE YEARS had Apple not stepped in, bought out his lease and then agree to pay FOUR TIMES that at $60 per square foot. It seems to me that the MTA got the sweetheart deal here.
Considering Apple's lease is only for 10 years, it means that its ONLY TWO YEARS LONGER than the remaining time on the $15 per square foot lease that the former tenant had. If you were the MTA and had the option of $15 per square foot for eight more years and then try to go out and score a new tenant OR you could get $60 per square foot for the next eight years on the same space but have to get that price for two more additional years (total of 10) before looking to renegotiate and then score a new tenant, then which would you pick?
Apple got the sweetheart deal? Seems to me that it was mutually beneficial.
Considering Apple's lease is only for 10 years, it means that its ONLY TWO YEARS LONGER than the remaining time on the $15 per square foot lease that the former tenant had. If you were the MTA and had the option of $15 per square foot for eight more years and then try to go out and score a new tenant OR you could get $60 per square foot for the next eight years on the same space but have to get that price for two more additional years (total of 10) before looking to renegotiate and then score a new tenant, then which would you pick?
Apple got the sweetheart deal? Seems to me that it was mutually beneficial.
First of all, the comptroller is just doing his job. A comptroller/controller is like the internal affairs of govt. If you work in govt, you're never happy to see him, he's only there to audit your money trail to make sure you're not doing anything stupid with tax funds and you want him to leave ASAP so you can get back to doing whatever it is you're supposed to be doing.
Second, according to WSJ, there was a bidding process. Part of the contract terms was that the new tenant would have to pay the old one to vacate the lease.
Just so you know, if there was no bidding process, some other big retail conglomerate could come in and say, I wanted to buy that space too, I have the capital, and I also have the brand recognition to create an anchor store. On top of that, I could've given the taxpayers a better return. But since you, the MTA, didn't go through an open bidding process, I didn't get a chance to bid an offer. That's unfair, so now I'm suing you.
Right, and Republicans don't do that. 
With that said, the inquiry is stupid. The contract is signed, and the State can't do anything without paying Apple damages for violating the contract.
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Well said. Without the subsidy, you wouldn't have any roads, air transportation, or rail system. Other things, such as the electrical system, and Internet were subsidized as well. Perhaps, only the people who use the police, fire department, and the rest should pay for those as well. If that were the case, those things would go away as well.
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Bloomberg has essentially admitted as much. He ran under the Republican Party merely because he couldn't get the nomination under the Democratic Party.
With that said, the inquiry is stupid. The contract is signed, and the State can't do anything without paying Apple damages for violating the contract. ----------
Well said. Without the subsidy, you wouldn't have any roads, air transportation, or rail system. Other things, such as the electrical system, and Internet were subsidized as well. Perhaps, only the people who use the police, fire department, and the rest should pay for those as well. If that were the case, those things would go away as well.
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Bloomberg has essentially admitted as much. He ran under the Republican Party merely because he couldn't get the nomination under the Democratic Party.
I wish Steve was here to see this.
But he's not. "Steve" no longer exists. Apple will be better off the sooner that everyone realises this - and the sooner that people stop thinking "what would Steve do".
We're in the post-Jobs era. (But still in the era of PCs...)
Isn't the $200 quoted for a Hamburger joint, that is going to add a whole bunch of infrastructure and service demand costs to the building that your retail space won't.
Then you might have a tourist/traveller focused shop in the location who are renting not just the space but market exposure.
Apple brings it's own demand and doesn't have a kitchen. To them it's just space, rather sexy space, but just space none the less. The same applies to every masthead tenant. Apple, Target,.... If you know their name they get a better deal.
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Actually hes just a politician, (especially DiNapoli) this is a look at me, look at me, not a lets be sure we are getting top dollar for the space. Deal pays $1M more a year then the last deal and rents property that was going to be vacant (though 1/2 of it rented for the next 8 years). This is a much better deal that that.
Just so you know (since we are apparently buds like that), they have been trying to rent the unrentable half for years, noone was really interested, even after they came up with the put the two balconies together after Apple said the original space was too small, Apple still the only one interested, a largely open air area doesn't work for most stores. This isnt a bidding war, noone else was interested in the property even disregarding the heavy frontend costs.
I think NY should pay Apple just for being there. It's an extreme honor for any town to have an Apple store. Apple does so much for the local community.