Luxury department store Nordstrom has much higher hopes for the New York market now that its palace for shopping in Manhattan has officially swung open its doors.
Combined with its online presence in New York City, several Nordstrom Rack outlets (and those on Long Island) and two small local concepts in the city, Nordstrom’s new flagship may help power over $700 million in annual sales from the New York market, according to Bank of America Merrill Lynch researchers. It’s a number that Jamie Nordstrom, Nordstrom’s president of stores, thinks is on the mark.
“Absolutely,” remarked Nordstrom in an interview on Yahoo Finance’s YFI AM about the investment bank’s projection. “Manhattan is already our single biggest New York market, and online is over 30% of our business. We know when we have a store in the market such as New York [City], which is the largest retail market in North America, it lifts all boats.”
Without question, Nordstrom’s New York City store is primed to do its part. By all measures, it’s a true homage to luxury goods shopping in the age of digital.
The seven-story, 320,000-square-foot space has expansive, eye-catching departments for shoes (shoes has always been a focus of Nordstrom’s), womenswear, accessories and beauty. Services — designed to get New Yorkers into the store more frequently — include an upscale bar, Italian restaurant and places to get a blowout or Botox.
Definitely not the boring, standard department store model — that could be seen nearby at the storied Macy’s Herald Square.
While the new shopping hot spot will be a draw for many locals and tourists, Bank of America Merrill Lynch does caution investors on being too upbeat initially.
“We worry that the NYC flagship store will disappoint bulls who view it as a meaningful earnings and ROIC catalyst,” Bank of America Merrill Lynch’s retail team writes. “We model the NYC entry as neutral to earnings in year one and think the stores will have to comp on top of grand opening volumes in year two to drive earnings accretion.”