Microsoft is opening a new flagship brick-and-mortar store at 677 Fifth Avenue, along New York City's Upper Fifth Avenue. The building, which is currently a Fendi shop, stands in a high-end retail destination that caters to both locals and tourists. According to commercial real estate brokers Cushman & Wakefield Inc, the average rate of retail rents in the area is at $2,749 for every square foot.
Microsoft has leased the site and has been dealing with negotiations which spanned more than five years. The plan to launch a retail store was officially announced back in February 2009. Following the announcement, the company appointed David Porter as corporate vice president of retail stores.
"As our first flagship store, it will serve as the centerpiece of our Microsoft Stores experience. This is a goal we've had since day one -- we were only waiting for the right location. And now we have it," said Porter.
Microsoft's strategy is focused on opening stores that are as close as possible to Apple stores; this is several blocks south of the Apple store. The company aims to expand its retail presence in the Apple-dominated high-end retail market. The iPhone maker has been noted for redefining the shopping experience among its stores. Currently, Apple has 254 stores sprawled across the U.S. while Microsoft has 104 physical stores located in Canada, the U.S. and Puerto Rico.
In the meantime, Microsoft has been creating a number of Microsoft mini-stores inside Best Buy, which has at least 600 stores across the nation. Apart from the upcoming flagship store that is about to open on Fifth Avenue, the company will soon put up 10 more Microsoft retail stores in the U.S. and in Canada as a way to take advantage of the upcoming holiday season.
Porter added that Microsoft plans to make the Microsoft retail store on Fifth Avenue more customer-oriented as it will feature a sort of an experiential space to make it more than just the familiar Microsoft store.
The store on Fifth Avenue will be the company's first full-line retail store in a high-end Manhattan space. Its other stores at the Staten Island Mall and The Shops at Columbus are categorized as specialty stores and are definitely smaller compared with the upcoming full-line store.
In 2012, the company put up a temporary store along Times Square during the holiday season to launch its products, which included the Surface tablet and Windows 8.
Compared with the other locations, the spot at Fifth Avenue offers a more diverse mix of shoppers who are definitely around the area for reasons that go beyond tourism.
"Fifth Avenue has fast retail and luxury," said Joanne Podell, a vice chairman of Cushman & Wakefield who specializes in luxury and specialty retail brokerage in Manhattan. "This street appeals to everyone from the wealthy to the not-so-wealthy. It's an ecumenical street."
