Apple's Grand Central Neighbor Seeing 7% Increase In Sales

New York City's Metropolitan Transportation Authority (MTA)'s sweetheart deal for Apple's just-opened Grand Central Terminal retail store seems to be paying dividends for the MTA and neighboring stores. One restaurant is reporting a 7 percent increase in sales since the store opened in December.

michaeljordansteakhouse
Michael Jordan's The Steak House is located across the terminal from the new Apple Store, Grand Central and co-owner Peter Glazier says the restaurant has seen a 7 percent jump in sales in the seven weeks that the Apple Store has been open, reports Crains New York. Glazier also says the rise isn't because Apple replaced another restaurant, Metrazur, in the terminal. "The jump only happened after Apple opened," said Glazier, not in the several months that the space was being renovated as the store was built.

There was some criticism of the deal that Apple and the MTA worked out, most notably around the lack of a revenue sharing agreement which is standard for most tenants of Grand Central. Apple's $60-per-square-foot lease agreement is also significantly lower than what most other tenants are paying. The MTA argued that a flagship Apple Store would bring in significant foot traffic to the terminal, benefiting both other GCT tenants and the terminal as a whole.

The MTA has previously noted that for every 1% increase in sales across the terminal's retailers, the MTA will gain $500,000 in rent due to the percentage rent provisions in place on the leases of nearly every other tenant with the exception of Apple.

MTA's gamble appears to be paying off, for at least one establishment.

(Photo via Yelp/Chris F.)

Top Rated Comments

tlevier Avatar
159 months ago
Sure nothing but MTA losing a boatload of money on a sweetheart deal with Apple. Someone is paying a price.

They aren't losing a boatload. The previous tenant had a lower rent than Apple is paying and their contract had another 7 years or so (can't remember). So, by Apple getting in this space, MTA is making more than they would have.

Further, the $60 per square foot Apple is paying to MTA isn't the total cost. Apple bought out the previous tenant with Millions of dollars up front, and Apple contributed even more to necessary renovations to the building (new elevator is what I heard.)

So, if you're the MTA, and you have someone willing to come in and bring more foot traffic, and that person agrees to improve your building, and that person agrees to pay more than a low rent tenant with a long contract, and they agree to pay-off that tenant.... what is there to say no to?
Score: 22 Votes (Like | Disagree)
rnizlek Avatar
159 months ago
Sure nothing but MTA losing a boatload of money on a sweetheart deal with Apple. Someone is paying a price.

Correct me if I'm wrong, but I thought the MTA was actually getting more per square foot than they did from the previous restaurant that occupied the premises.
Score: 20 Votes (Like | Disagree)
basesloaded190 Avatar
159 months ago
That seems a bit low. You both remove an empty anchor store, increase foot traffic, and there's a 7% increase? That's the equivalent of an extra 10 tables a night I would estimate. I don't understand how this is news.

10 extra tables a night, and let's say $50 a table (which is probably on the low side) X 7 days a week X 7 weeks so far = almost $25000 in extra sales without doing a single thing.
Score: 20 Votes (Like | Disagree)
hobo.hopkins Avatar
159 months ago
So, if you're the MTA, and you have someone willing to come in and bring more foot traffic, and that person agrees to improve your building, and that person agrees to pay more than a low rent tenant with a long contract, and they agree to pay-off that tenant.... what is there to say no to?

Ah that would be the rational response that one would have to the entire situation. However some in these forums think that Apple can do no right, so your logic won't have any effect on them.

The entire deal works in the MTA's favour.
Score: 8 Votes (Like | Disagree)
writingdevil Avatar
159 months ago
They aren't losing a boatload. The previous tenant had a lower rent than Apple is paying and their contract had another 7 years or so (can't remember). So, by Apple getting in this space, MTA is making more than they would have.

Further, the $60 per square foot Apple is paying to MTA isn't the total cost. Apple bought out the previous tenant with Millions of dollars up front, and Apple contributed even more to necessary renovations to the building (new elevator is what I heard.)

So, if you're the MTA, and you have someone willing to come in and bring more foot traffic, and that person agrees to improve your building, and that person agrees to pay more than a low rent tenant with a long contract, and they agree to pay-off that tenant.... what is there to say no to?

The whole rent thing has been debunked long ago and it works in MTA's and other retailers favor, consistently, and that's from independent accounting reports. Some people just won't let go or have to find fault somewhere, and here they land.

"...10 extra tables a night, and let's say $50 a table (which is probably on the low side) X 7 days a week X 7 weeks so far = almost $25000 in extra sales without doing a single thing..."
It's actually more than that. The place is very spendy, food is great, often hard to make a reservation, and serves 200 to 360 depending on configuration. Figure all that in and it's like a grand a night. And both MTA and Apple got so much criticism (mainly from people who didn't know the facts), why not show a first look response....or is it only good to show the negatives?
Score: 6 Votes (Like | Disagree)
PlaceofDis Avatar
160 months ago
its impressive that one store could increase traffic that much, but i am not surprised given just how busy all the apple stores are that i have been to, so there is obvious demand for more stores.
Score: 5 Votes (Like | Disagree)

Popular Stories

maxresdefault

Apple Announces 'Let Loose' Event on May 7 Amid Rumors of New iPads

Tuesday April 23, 2024 7:11 am PDT by
Apple has announced it will be holding a special event on Tuesday, May 7 at 7 a.m. Pacific Time (10 a.m. Eastern Time), with a live stream to be available on Apple.com and on YouTube as usual. The event invitation has a tagline of "Let Loose" and shows an artistic render of an Apple Pencil, suggesting that iPads will be a focus of the event. Subscribe to the MacRumors YouTube channel for more ...
Apple Silicon AI Optimized Feature Siri

Apple Releases Open Source AI Models That Run On-Device

Wednesday April 24, 2024 3:39 pm PDT by
Apple today released several open source large language models (LLMs) that are designed to run on-device rather than through cloud servers. Called OpenELM (Open-source Efficient Language Models), the LLMs are available on the Hugging Face Hub, a community for sharing AI code. As outlined in a white paper [PDF], there are eight total OpenELM models, four of which were pre-trained using the...
Apple Vision Pro Dual Loop Band Orange Feature 2

Apple Cuts Vision Pro Shipments as Demand Falls 'Sharply Beyond Expectations'

Tuesday April 23, 2024 9:44 am PDT by
Apple has dropped the number of Vision Pro units that it plans to ship in 2024, going from an expected 700 to 800k units to just 400k to 450k units, according to Apple analyst Ming-Chi Kuo. Orders have been scaled back before the Vision Pro has launched in markets outside of the United States, which Kuo says is a sign that demand in the U.S. has "fallen sharply beyond expectations." As a...
iPad And Calculator App Feature

Apple Finally Plans to Release a Calculator App for iPad Later This Year

Tuesday April 23, 2024 9:08 am PDT by
Apple is finally planning a Calculator app for the iPad, over 14 years after launching the device, according to a source familiar with the matter. iPadOS 18 will include a built-in Calculator app for all iPad models that are compatible with the software update, which is expected to be unveiled during the opening keynote of Apple's annual developers conference WWDC on June 10. AppleInsider...
iOS 18 Siri Integrated Feature

iOS 18 Rumored to Add These 10 New Features to Your iPhone

Wednesday April 24, 2024 2:05 pm PDT by
Apple is set to unveil iOS 18 during its WWDC keynote on June 10, so the software update is a little over six weeks away from being announced. Below, we recap rumored features and changes planned for the iPhone with iOS 18. iOS 18 will reportedly be the "biggest" update in the iPhone's history, with new ChatGPT-inspired generative AI features, a more customizable Home Screen, and much more....