Amazon.com Inc is taking over an entire building on 34th Street across from the Empire State Building in New York, according to construction and real-estate executives, raising questions about just what the giant retailer is up to.
The property, at 7W 34th St, is 12 stories. The executives said Amazon would use the building for offices and a distribution center.
This week, Amazon abruptly pulled out of a deal for a large block of space at 1133 Avenue of the Americas.
The retailer has no brick-and-mortar presence in Manhattan or, for that matter, anywhere else.
So the deal ignited intense speculation that perhaps Amazon was going to do something that has been endlessly rumored: Open an old-fashioned store.
The prospect of a store was first reported by the Wall Street Journal.
Whether there will be an Amazon store any time soon on 34th Street seems an open question.
The two retail outlets in the building, a Mango and an Express store, recently signed new leases.Mango store manager Juliana Ochoa said the retailer had no plans to move out of its space.
“I’ve never heard of Amazon coming here,” she said.
Amazon declined to comment.
Lisa Vogel, a spokeswoman for Vornado Realty Trust, which owns the building, did not return calls for comment.
Amazon opening a physical store is one of those stories that is constantly the subject of speculation in the technology news media, similar to what the next Apple Inc iPhone will be like or what the iPhone after that will be like.
The report of a possible Amazon store immediately became the top article on the Techmeme Web site, which collects technology news.
Part of the fascination is the irony: The company that basically invented e-commerce would be acknowledging the virtues of old-fashioned shopping.
For all their focus on the future, technology companies have been expanding to traditional retail for quite a while.
“There’s a growing realization that you can’t force customers to shop in just one way,” said Chris Donnelly, global managing director of retail strategy at Accenture, a consulting firm.
“We’re in a world where the retailer can no longer dictate the shopping experience,” he said.
The pioneer here was Apple, which has more than 400 stores worldwide. Microsoft Corp has quietly followed, with more than 50.
Even Amazon has partnered with retail outlets for its lockers, secure places that customers can pick up a purchase if they cannot get it delivered to their home.
The retailer has declined to make the sort of wholehearted commitment that its peers did.
As RadioShack struggled recently to stay viable, there was speculation that Amazon would snap up the chain and infuse it with new life. It did not do so.
If one of the ground-floor retailers at the 34th Street property is bought out and the space does indeed become an Amazon outlet, the likeliest outcome is that it will be a showroom for Amazon’s hardware, including its respected Kindle line of tablets and e-readers and its unpopular Fire phone.
“It makes sense to have a physical showroom to let people see Amazon’s hardware products, particularly with the Kindle priced at US$100,” BCG Partners analyst Colin Gillis said. “You want to touch and see and feel these things.”
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