The MTA’s retail offerings are making headlines this week as one of the era’s most iconic computer brands is eying retail space in the country’s most iconic train terminal. As The Observer reported earlier this week, Apple may be gearing up to open a store in Grand Central.
As is often the case with rumors about future Apple Stores, none of those with any knowledge of the deal could talk to reporter Laura Kusisto, but ifoAppleStore confirmed Apple’s interest in the landmarked terminal. The process to rent space from the MTA is a long one involving stringent RFPs and tight control over the space by the landlords. Still, as Apple looks to siphon customers away from its crowded 5th Ave. store while tapping into the crowds that pass through Grand Central, it’s enticing rumor at least.
For its part, the MTA said little to Kusisto about a next potential tenant, and we’ll just have to wait out the RFP process. “We select tenants through a public process that features a formal request for proposals,” said Aaron Donovan, a spokesman for the MTA. “We don’t comment on prospective tenants outside of the process.”
Even if no one wants to talk, this rumors got me thinking about the MTA’s retail division. A frequent charge leveled by politicians at the authority concerns the way it does or doesn’t make use of its extensive holdings. As I walk through the subway system, I’m often struck by how little space is actually used. While some stations see peak crowds too overwhelming to squeeze more onto a platform, most have open areas to spare, and yet, retail is sparse.
Those stations that do sport stores do not seem to feature much in the way of use or creativity. A few storefront ATM locations populate the 42nd St./Times Square terminal while a record store earned headlines when it reopened a few years back. By and large, though, newsstands are all that we see in the subway, and even those are only set up at the big hubs.
The headlines about subway retail aren’t particularly pretty. A long-standing dispute in Jackson Heights simmered over during the fall, and that type of coverage is more representative of the MTA’s retail reality. They want to attract more stores, but something about the subway doesn’t work. Perhaps it’s being identified with something New Yorkers consider dirty and inconvenient, rat-infested and unclean. Perhaps its the ebb and flow of crowds that aren’t looking to shop and don’t notice the store.
Still, as Stephen Smith pointed at Market Urbanism this week, retail in the subway is a great missed opportunity. While urging transit agencies to maximize their real estate holdings, he ponders the economics of it all. “Does anybody know how much money such schemes can generate?” he asks. “Obviously allowing vendors to set up shop in train stations isn’t going to obviate the need for a thorough reform of the way this country does mass transit to make it profitable and sustainable, but can it amount to anything more than a drop in the bucket?”
As San Francisco’s BART looks to develop its retail offerings, here in New York, Jay Walder would like to do the same. The guys in charge answer Smith’s question by proclaiming profitability. The MTA CEO and Chair discussed underground retail with me in November. “We will make more money if we can improve the retail environment in the subway system, get greater value out of the spaces that we have there, improve the ambiance and the customer satisfaction,” he said while praising new retail initiatives at Times Square. “We’ll make more money than all of the naming rights deals.”
Ultimately, though, the rest of the system doesn’t carry the passenger volume of Times Square or the cachet of Grand Central that has seemingly enticed Apple to ask some questions. It might be possible to milk some money out of constantly crowded stations, but subway travel is so fleeting. Neighborhood stations are crowded for an hour or two every morning and serve as ghost towns after that. Would a up-market retailer take that risk? I don’t think so.