By Lois WeissNovember 5, 2014 | 6:34am
The not-quite-haute-and-mighty Coach is in such a sales freefall, we hear it is reevaluating the ownership structure of its long-touted move to the upcoming new Related Cos. and Oxford Properties skyscraper at 10 Hudson Yards. The tower won’t be ready for several more years.
At the end of October, the company reported sales slumped 19 percent in North America and 10 percent overall. It also now plans to close 70 North American stores, which is a fifth of its retail locations.
Coach has already agreed to sell its current nearby office building at 516 W. 34th St. to Related, which would redevelop it into another tower. It also rents space at 450 W. 33rd St., which it is giving up.
Coach also agreed to purchase the new, 737,774 square feet of offices, with options to buy two more floors. As its first anchor, as an incentive, the costs were to equate to Related’s costs: a rental value of $70 per foot and total price of more than $740 million.
Coach became a partner in the development but upon completion, its stake would convert to the ownership of its office condominium.
As an early Hudson Yards anchor tenant, Coach will also receive a 40 percent property tax break.
But now, sources said the thinking is that Coach could resell its new condominium and likely lease it back to free up the cash for other corporate needs.