With the Fulton St. Transit Hub set to open within the next six months, the MTA has chosen the Westfield Group, an Australian mall developer will annual revenue over $4 billion, to serve as Master Lessee for the space. Westfield will now be responsible for subletting the ample commercial space in the new facility and overseeing ad sales. It will also have to maintain and clean the leased portions of the Fulton St. Hub, and the MTA will share in a split of revenues. The company will sign a twenty-year lease with two ten-year renewal options.
“This master lease structure will unite risk and reward in a single, highly qualified and experienced private sector operator, while relieving the MTA of ongoing capital and operating costs and expenses and generating revenue for our operating budgets,” MTA Chairman and CEO Thomas F. Prendergast said earlier this week. “We are confident that Westfield will be motivated to maximize the revenues from the facility while maintaining in accordance with standards befitting the substantial investment the public has made in creating this wonderful new landmark.”
The lease will commence in June when the building opens to the public, and Westfield’s responsibilities include nearly all of the non-station areas in the transit center, Corbin Building and Dey Street Headhouse. The space encompasses approximately 180,000 square feet including 63,000 square feet for commercial uses. The MTA anticipates retail in approximately 42,000 square feet, and I’m sure everyone would love a Lower Manhattan Apple store. The so-called “public circulation areas” account for 60,000 square feet, and the remainder is back-of-house. Now, the pressure is on Westfield to turn this new station complex into a shopping destination as well.
So, Westfield will now operate the WTC mall and Fulton Center, while Brookfield operates the revamped Brookfield Place (former World Financial Center), and Howard Hughes is doing the other big retail downtown at South Street Seaport.
Westfield’s definitely got the benefit of central location and foot traffic.