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Faith Hope Consolo
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In the News

Bank Branches Disappearing?

And the last empty Lexington Avenue storefront in the Bloomberg Tower goes to—wait for it—Citibank.The company’s forthcoming 56th Manhattan branch, located between 58th and 59th streets, will fill a 5,000-square-foot void along this Upper East Side commercial block, which is so desperately underserved by the cavernous Wachovia branch next-door. And the Bank of America two doors north.

If not for the Home Depot sandwiched in between, it seems, the entire block might soon consist of banks.

Clearly, the looming North Fork branch now under construction across the street from the future Citibank branch (and the Wachovia and the Bank of America) wasn’t coming online fast enough to satiate consumer money lust.

Or something like that.

“It is what it is. Some retailers won’t pay. Banks will,” said an executive from Vornado Realty Trust, who noted that the block’s newest bank branch will be paying around $220 per square foot in annual rent—about the median street-level retail rent in Manhattan right now, according to the Real Estate Board of New York.

Her enthusiasm in confirming the deal was clearly lacking. “Who’s excited about having three banks on one side of the street?”

Not long ago, some retail brokers were predicting a sort of cataclysmic bubble burst for the city’s seemingly never-ending bank-branch boom. For the better part of the current decade, the boom had reverberated throughout Manhattan and parts of the outer boroughs.

“Where can they go? Because you get the feeling they are everywhere at this point,” said purported bank-leasing specialist Cory Zelnik, then president of Winick Realty, in a December 2005 interview with property-minded trade pub The Real Deal. (Mr. Zelnik, it should be noted, no longer works for Winick; he formed his own firm.)

Similarly, last April, Commerce Bank chairman Vernon Hill told The New York Times: “The building frenzy in branch banking is probably nearing its peak.”

At least at street level, these forecasts of a recession in the recent retail-leasing dominance of banks appear quite premature.

What’s replacing the East Village’s historic Second Avenue Deli? A Chase branch, according to a sign posted earlier this month on the boarded-up storefront.

Proprietors of the hallowed P&G Cafe Bar on the Upper West Side continue to hear rumors of their replacement at the corner of Amsterdam Avenue and 73rd Street by an as-yet-unknown bank branch once their lease runs out in 2008. By bar manager Steve Hale’s count, there are already at least 10 banks within three blocks of the 60-year-old neighborhood institution.

Similar rumors surround the corner of Bleecker and Thompson streets in Greenwich Village, where several retailers, including Ben & Jerry’s, recently lost leases.

Yet it would definitely be an understatement to suggest that bank branches are becoming the new Starbucks as they continue to pop up on every corner like beacons of corporate homogeny and hegemony. One HSBC branch literally replaced a Starbucks at the corner of Broadway and 102nd Street this past October.

“Every day, I get an offer from a bank,” said retail broker Faith Hope Consolo of Prudential Douglas Elliman, who’s admittedly struggling to land some sort of high-end fashion tenant at the northeast corner of Broadway and 58th Street, near Columbus Circle.

Instead, she’s been fielding calls solely from financial institutions.

Ms. Consolo, at least, seems resigned to a future strewn with storefront A.T.M.’s.

“Service tenants, like banks, have become ‘safe’ and desirable tenants because of their longevity in neighborhoods,” she said. “I certainly do not foresee an end to this influx of banks; they are here to stay.”

 

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