Home Depot stalling on 100,000 s/f deal.

Encouraged by the success of its first two Manhattan stores--one in the Bloomberg Building in midtown and the other on 23rd Street in midtown south--Home Depot has been planning to open a third store at 345 Hudson Street in what amounts to a logical southward progression to Manhattan's downtown. But nearly a year after talks began with landlord, Trinity Real Estate, to take 100,000 s/f in the building, Home Depot still hasn't signed a deal and sources with intimate knowledge of the transaction say the lease now hangs in the balance with just a 50/50 chance of getting done.

The holdup has been attributed to the tenant, who according to sources, has stalled closing a commitment for the space in order to conduct financial analyses and demographic studies of the area. Among Home Depot's concerns is the level of foot traffic in the area, which despite being near downtown's core office district and bustling residential neighborhoods Tribeca and the West Village, has struggled with higher than normal vacancy rates.

If the deal doesn't go through it would be a blow to the rosy predictions market experts and city officials have been heaping on the downtown market, whose thirst for retail has been said to be growing with its fast expanding residential population.

Even if it opts to pass on the lease at 345 Hudson Street, Home Depot is interested in establishing a third Manhattan store and would search for an other location, a source familiar with the company's retail strategy revealed. Trinity, meanwhile, is said to be on the cusp of signing a number of office deals that will go a long way towards eliminating the remaining portions of vacancy in its large Hudson Square portfolio of buildings.

Trinity inked a lease last week at 345 Hudson Street for roughly 80,000 s/f with CBS Radio in a deal first reported by Real Estate Weekly.