The New York herald., 1922-01-08
9Th AVENUE RENTS
OUTDO PROPHECIES
Realtor Suggests Partnership
of Owner and Tenant to Fix
Fair Price for Space.
BY ALBERT II. AsHFORTH.

In an article written for THE HERALD
in 1906 find that l made the follow
Ing statement: az remember ten years
ago (1S96) pointing out to prospective
lessees that a twenty-one year lease at
$1,000 O year net for q twenty-five foot
five story business building on Fifth
avenue, would prove an asset to any
lessee. The same properties offered at
that time are now $1,000 renting for
$4,000 or $4,000 a year net"
This statement in the light Of tho
leases that are being obtained at the
present day for the same class OF prop
erty in the section referred to at that
time certainly proves to have been con-
servative.
During 1921 a twenty-five foot altered
business building on Fifth avenue was
leased for as high as $4,000 net, show
ing a return OF per cent. on an Invest
ment OF 100000. How far this rise In
price Is TO continue Is problematical
though Il is only fair 20 point out that
we have been through a period or ex-
travagant prices in all things and real
estate values have been benefited there
by.
During the last few years when mer-
chants were securing high prices for ar
ticles and doing a large volume OF busi'
ness. their profits were high, but with
the adjustment of trade back to normal
these same articles must be sold at a
cheaper price than heretofore. Conse-
uuentiy a greater volume or turnover Is
necessary 70 show the same net profit
rs in the past. Larger quarters may be
re essary to accomplish this result. re-
quiring the leasing of more space but
hardly. should say. q greater payment
4 rent There Is a limit to all things.
md the merchants rent. probably. Is his
greatest item OF expense; consequently
no must consider most carefully his
chances of being able TO pay II. SO much
has been said about the fortune that Is
20 be made in a Fifth avenue location
In q few years that leases are made al
rents that cannot be paid, and In hard
times. failure may be the result. II oc-
ours to me that merchants who pay
SIS per square foot for stores. as know
them to be doing In some Instances. are
working for the landlord and will have
struggle 20 pay the rent Owners are
really partners with their tenants. and
should rent their properties on basis
that will show a proper return 10 them.
selves and fair profit TO their tenants
The future OF Fifth avenue from
Forty-second 20 Fifty-ninth street VIII
bear close attention IN the next fe"
years. The removal OF Saks from
Broadway TO Fiftieth street Will marx
the first break In this part Of the ave.
nue. for large retail business and should
have the effect OF bringing many other
concerns Of like nature to this neighbor-
hood. I remember very well when Th-
fany e. Co. moved TO Thirty-seventh
street and Fifth avenue. Thirty-fourth
70 Forty-second street was still In an
embryo state. To-day II Is half mile
Of intensely retailed business. Ten years
from now will show that Forty-sccond to
Fifiy-ninsh street will be developed
along the same lines.
In 1906, when we talked OF taking five
feet from the sidewalks In order TO
widen Fifth avenue and suggested that
trucking be kept off the avenue from 10
A. NJ. 20 p. NJ. because the carriages
woro often blocked behind those trucks
and had difficulty In crossing Thirty
fourth and Forty-second streets we little
thought that with the widening accom-
plished Fifth avenue would practically
he impassable for vehicles during the
hrsy hours. This problem Is the one
uppermost IN the minds OF merchants on
Fifth avenue, and those who contemplate
going there. and a way must be found
to cope with these conditions.
one OF the chief reasons that large re-
tail stores should he attracted 20 locate
above Forty-second street Is the diffi.
Guilty that residents further up town
Nave IN crossing the main arteries Of
traffic, such as Forty second street. Some
s'orcs such ne Lord q Taylor. Altman
McCreerv and Macy. who draw their Gus
toners from all over New Jersey and
ong Island ls vcll as New York CITY
re- not affected by this restriction %
'raffio. hut the merch0 nte whose hus-
ness Is Of a more specialized nature pre-
FER 10 be IN a location epsily accessible
20 the so-called social center.
with the gradual Improvement In
business conditions general real estate
wlll benefit thereby and the outlook
encouraging for the coming year. though
no boom should he looked for.