At some point, when the MTA finally opens the Fulton Street Transit Center and perhaps too when East Side Access comes online, the authority will have a wealth of commercial real estate in high-traffic areas that they want someone else to manage. When the time comes, the authority will try to identify a private entity to take out a master lease for the space and manage it. For now, though, the rehabilitated Columbus Circle with 11,500 unused square feet of retail space will serve as a guinea pig.
The authority announced this week that it has begun the RFP process to find a real estate company willing to sublease 13 spaces in the Columbus Circle space. The winning bidder will oversee the various retailers while also marketing the concourse as a retail destination and keeping the straphanger circulation areas in front of the stores free of trash and other potential hazards. The stores would occupy the concourse that runs underneath 8th Ave. for a few blocks. (Check out some photos right here.)
“It is imperative that the MTA find new ways to reduce expenses and make the most out of its real estate portfolio,” MTA Chairman Joseph J. Lhota said in a statement. “Thinking creatively about our real estate holdings and the way we engage with the private sector has led us to pursue a partnership that we expect will increase MTA revenue and allow us to focus our resources on those parts of the station where they are most needed. We think this public-private partnership will prove to be a useful model that will help us improve the management of retail spaces at larger stations going forward.”
In the release touting this effort, the MTA noted that this would be the first agreement of its kind. A private sector firm would be for subletting individual retail spaces and for maintaining adjoining public areas within the transit system. At Grand Central, the MTA maintains the public concourses. If all goes well, the same model will be exported to Fulton St.
In a way though, it’s easy to view this as a tacit admission from the MTA that retail isn’t a strength. Columbus Circle is the seventh busiest station in the system, and the renovations have been completed for some time now. The retail spots though remain empty, and with each passing day, the MTA isn’t realizing dollars it could use. As long as they draw some interest in the space, they’ll earn some dollars too.