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Tenant Troubles at the Plaza


Another day, another story about retail tenants demanding a break. This time it's at the Plaza Hotel in New York. A few years ago the property underwent a massive redevelopment. The upper floors were converted to high-end residences. (These have had their own problems.) The lower floors, meanwhile, have become a luxury shopping mall called the Plaza Retail Collection. Apparently, the destination isn't working out so well.

With their business in the red following a brutal holiday season, more than half of the upscale shops at the so-called "Plaza Retail Collection" are demanding lower rents, sources told The Post.

Accusing Plaza owner Elad Properties of penny- pinching - including skimping on sorely-needed marketing - a few of the shops are threatening to leave and may take Elad to court in the process, sources said.

The retail rift is the latest black eye for Elad, an Israeli real-estate firm that shelled out $675 million to buy the city landmark in 2004. While Elad spent another $400 million on renovations, it has since been engulfed in legal tussles with unions, contractors and angry condo buyers.

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Elaine Misonzhnik

Senior associate editor Elaine Misonzhnik has been writing for National Real Estate Investor since June 2006 and has covered commercial real estate for more than 12 years. She first became...
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