K-mart in Pen Plaza in the heart of Manhattan.
Another Lost Blog:
The tour guides on the downtown tour would always take the opportunity to point out the K-Mart when we passed it. Why? Because it has a really interesting story. The first thing the tour guide asks when you pass it is if you notice anything strange about the store. After a few seconds of staring at blank faces, he says triumphantly "No parking lot!" And then launches into to the story of Manhattan's K-Mart. Here is what he told us:
K-mart was at first very relunctant to open a store in Manhattan because there was no parking. How are you going to get your larger items home on the subway? The City of New York made K-Mart a very attractive offer. They said try it for two years and if it fails, the City will pick up your lease for the two years. So K-Mart opened in Manhattan. The K-mart in Manhattan is the number one in the country for sales and made so much profit that K-mart was able to close a whack of stores in other parts of the US without hurting profits.
However, we are not sure that the story is true. We have been unable to substatiate this story. In fact, according to a
December 1994 New York Times article (
click to see the article), Manhattan was a complete change in strategy from a company in response to Walmart's new dominance in the discount marketplace. The article specifically says that no incentives were offered:
"No state and city subsidies or tax abatements were offered to lure the giant retailer. As America becomes saturated with discount outlets like Kmart and Wal-Mart, high-rent urban centers like Manhattan have become more attractive. The Manhattan move is part of a larger strategy by Kmart to tap fresh markets in the face of flagging earnings and sharp cost cutbacks. Because of aggressive openings in recent years, Kmart officials said they now have at least one store in each of the most populous 50 metropolitan areas."
The profit part of the story seems to be true as K-Mart returned to profitability for a short time after they open their stores in Manhattan. However, it would appear the City of New York never offered any special incentives for them to move there. If the City of New York offered K-Mart incentives like the tour guide described the New York Times would have known about it and reported it. But it is strange that a native New Yorker like our tour guide would get something like this wrong. Hmmm. We report. You decide.
