Bull's-Eye for Vornado if Target Signs on at City's Biggest Development Hole

NEW YORK CITY-For the past few years rumors have abounded over the fate of the biggest vacant lot in Midtown between East 58th and 59th Streets from Lexington and Third Avenues. In the past couple of months the stories have been gaining momentum. Now, the latest word is that the increasingly popular national retail chain, Target, will bring its red and white bull’s-eye logo to Manhattan for the first time. Spokespeople for Target tell GlobeSt.com that the negotiations are real but nothing has been signed. Vague as well are reports that news giant Bloomberg still has an interest in the site.

“Target is rumored to be interested in the property,” observer Charles Aug of Garrick-Aug Assoc. Leasing Inc. tells GlobeSt.com. “We think that they would be a wonderful fit for New York. We’ve been pleased with Kmart’s success here; they’ve helped New York a lot too.”

“It is becoming increasingly difficult for retail, since space is so scarce and rent is getting higher,” Aug notes. “Even if rent softened, the space would still be a challenge. They would do a wonderful thing for New York and they have a strong audience among New Yorkers.”

Owner Vornado’s plans for the space across the street from Bloomingdales have been in limbo for years. Residents and commercial real estate insiders alike grew hopeful when the REIT had the foundation poured–but construction stopped after that. Then news that Bloomberg had agreed to lease space within what was to be a major new skyscraper also fizzled and speculation arose that the company was looking at other locations, including offices on Park Avenue to be vacated by Donaldson Lufkin & Jenrette.

That space, at 277 Park Ave. would be subleased by the firm, which is consolidating its operations with Credit Suisse First Boston. Insiders speculate that Bloomberg’s change of heart was directly linked to frustration over the long delays. Further delays are rumored to be the result of reconfiguring the design concept for the property.

Vornado, Bloomberg and Target officials all agree on one thing–they can’t disclose the official leasing details until papers have been signed. With the years it has taken Bloomberg’s lease to get to the stage it is at now without any signatures, it is unclear how solid the deal will be for Target. Aug says, “It would be a real shame if they didn’t land Target.”