LVMH Files for Demolition Permits to Re-develop Flagship Fifth Avenue Store

Retail giant LVMH has announced plans to demolish its flagship store at 1 East 57th Street in Manhattan’s Plaza District to make way for a new tower. Although detailed plans for the new building have not yet been filed, LVMH previously filed for the demolition of the adjacent building at 743 Fifth Avenue in March 2024.

Demolition Details

The recent demolition plans, filed under job number M01053745 on June 6, 2024, outline the demolition of a 226-foot-tall, 91,060-square-foot building. During the construction period, LVMH will maintain its presence in the area through a seven-year lease at Trump Organization’s 6 East 57th Street, as reported by the New York Post.

Property Specifications

The existing retail building in Midtown East spans 91,060 square feet, with a lot size of 6,224 square feet. The parcel, zoned C5-3, allows for up to 15 times the floor area ratio (FAR) for commercial purposes and up to 10 times FAR for residential use with inclusionary housing. As of 2022, the property’s market value was assessed at $48.8 million.

Financial Performance

The property generated $8.7 million in revenue, translating to $95 per square foot, according to the latest income and expense figures.

Legal and Compliance

Public data indicates that the property incurred $4,525 in OATH penalties over the past year. However, no lawsuits or bankruptcies have been filed against the property in the past 24 months.

Midtown East Overview

Midtown East, predominantly occupied by office buildings (81% of its 62.6 million square feet of commercial space), also hosts hotels and has seen substantial real estate activity. With $3.6 billion in sales volume over the past two years, it ranks second in sales turnover and development activity in New York City, boasting 16.8 million square feet of commercial and multi-family construction in the same period.

Local Real Estate

On the specific tax block housing the LVMH property, seven out of 19 commercial properties (970,594 square feet out of 1,921,836 square feet) are owned by notable entities, including Buchbinder & Warren, Paramount Group, and Richard Gordon. No new building projects are currently active on this block.

Recent Transactions

Within a 400-foot radius of 741 5th Avenue, 17 significant commercial real estate transactions have occurred in the last 24 months, totaling $1.3 billion. The most notable sale was Prada's purchase of a condo unit at 730 5th Avenue for $12.6 million. Additionally, Solil Management secured an $18 million loan from State Farm Realty Mortgage, using their office building at 592 Madison Avenue as collateral.