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Toys 'R' Us Exit Got Vornado Stumped?

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The REIT executives are still mulling over how they are going to make money on the chain's real estate.

It may have seemed like a great deal in the mid-2000s, but it appears as though Vornado Realty Trust might be facing a challenge in how to make money off its investment in the Toys 'R' Us retail chain in the new market environment. Earlier this year, it became clear that a profitable IPO would not be in the cards for some time. Now, NorthJersey.com reports, selling some of the chain's stores does not seem all that easy either.

According to the media outlet, when asked by an analyst about the possibility of making money by closing some of the stores and selling them to third parties, Vornado Chairman Steven Roth responded:

"The answer to that is yes, but it's a much more complex question than that," Roth replied. Part of the difficulty, he said, is figuring out how to remove those stores, and monetize them, "and still maintain a viable toy business." Asked if any decisions about Toys "R" Us real estate were imminent, Roth said the subject was an "ongoing thought, which we don't have anything to say about now."  

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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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