Pricing Strategy: A Case Study on Progressive Leasing at 510 Driggs Avenue
At Verada, we understand the critical role that pricing strategy plays in New York City's competitive real estate market. A prime example of our strategic approach is the leasing of 510 Driggs Avenue, a new mixed-use development with 26,000 square feet of retail space across two floors in the vibrant Williamsburg neighborhood of Brooklyn.
Introduction
In a market where leasing over 12,000 square feet of subgrade retail space poses significant challenges, Verada adopted an innovative approach. Our goal was to maximize the total square footage of the property while achieving the highest blended rent for any retail space exceeding 10,000 square feet in North Williamsburg. This case study highlights how our progressive leasing strategy resulted in securing top-tier tenants and filling the entire retail space with dynamic, community-focused businesses.
The Verada Approach
Our success at 510 Driggs Avenue was driven by the "Verada Approach," an innovative method combining omnichannel marketing and data-driven tenant vetting. This approach leveraged our deep understanding of local consumer demographics and retail demand, allowing us to identify and secure the best possible tenants for the space.
Securing Anchor Tenants During Early Construction
During the early construction stages of 510 Driggs Avenue, Verada successfully signed The Learning Experience as the anchor tenant, securing 12,500 square feet for this premier early childhood education provider. As construction progressed, we continued to attract additional tenants, filling the remaining spaces with high-quality, community-focused brands like Barry's, Impact Kitchen, and Perspire Sauna Studio.
Both tenants and ownership benefited from signing leases at this early stage. Tenants enjoyed savings on construction costs by collaborating early on buildout requirements, while ownership was able to recapitalize the note at an early phase in the development. This proactive approach allowed for a more streamlined construction process and mitigated financial risk, ultimately maximizing the property's value well before project completion.
The Tenants
510 Driggs Avenue now houses an impressive mix of retail tenants, each carefully selected to complement the neighborhood’s evolving needs:
- Barry's: The globally recognized fitness brand leased 5,200 square feet of on-grade retail space. Known for its high-intensity interval training (HIIT) workouts, Barry's brings a premium fitness experience to Williamsburg, attracting health-conscious residents. The 10-year lease was finalized at $150 per square foot, adding a high-profile tenant to the property.
- Impact Kitchen: This Toronto-based health-conscious restaurant brand leased 2,800 square feet, offering nutritious, locally-sourced meals. Impact Kitchen’s commitment to whole, clean food aligns perfectly with the wellness-focused tenants at 510 Driggs and further enhances the neighborhood’s health and fitness offerings.
- Perspire Sauna Studio: Occupying 2,800 square feet of subgrade space, Perspire Sauna Studio offers a range of wellness therapies, including infrared sauna, red light, and color light therapies. This addition complements the health-conscious environment created by other tenants and provides a holistic approach to well-being for local residents.
- The Learning Experience: This nationally recognized early childhood education provider secured 12,500 square feet, creating a valuable resource for families in the area. The Learning Experience will establish a hub for early education and daycare, catering to the growing family-oriented community in Williamsburg.
- Baker Health: Baker Health occupies 5,000 square feet, with 1,500 square feet at grade and 3,500 square feet below grade, providing essential pediatric healthcare services to the neighborhood. Their presence strengthens the family-friendly atmosphere in the community.
A Synergistic Community
The diverse mix of tenants at 510 Driggs Avenue has created a vibrant and synergistic retail environment that enriches the neighborhood. From health and wellness services to early childhood education and family healthcare, each tenant plays a vital role in establishing the property as a cornerstone of community life. Verada's strategic tenant selection not only maximized the value of the property but also created long-term value for the surrounding neighborhood.
Setting a New Standard
This case study showcases how Verada’s innovative pricing and leasing strategies transcend conventional norms. By securing high-quality tenants during early construction and fostering synergies between them, we created a thriving retail environment that contributes to both the property's success and the vitality of the Williamsburg community. Verada continues to make a positive impact on New York City neighborhoods by creating retail spaces that benefit landlords, tenants, and local residents alike.
Client Testimonial
“Brendan and Nate and their team at Verada have done tremendous work for me at 510 Driggs. A great mix of quality credit tenants and operators that work for the property and the neighborhood. A perfect example of progressive leasing.”
– Robert Rosenthal, Northlink Capital CEO
