Retail lease is latest phase of 1328 Broadway transformation.

RFR Holding LLC has completed negotiations with the Swedish retailer Hennes & Mauritz for a 70,000 square-foot lease at the former Marbridge Building at 1328 Broadway for a three-level retail store.

Earlier this year, RFR purchased the 12-story office and retail property located on 34th Street at Sixth Avenue and is now dramatically re-configuring the retail and office space to more than double the retail capacity and create one of the largest available blocks of contiguous office space in Midtown South. As part of RFR's repositioning strategy, the name of the building has already been changed to "2 Herald square" and both lobby entrances of the building are being completely renovated.

RFR plans to increase the retail space in the building to a total of 140,000 square feet, up from the roughly 45,000 square feet currently occupied by an HMV music store, which leases 25,000 square feet on the ground floor and a portion of the second floor. Federal Express and other small retail tenants are located on the ground floor. Hennes & Mauritz will occupy the balance of existing retail space on the ground and second floors and the entire third floor, which is being convened to retail use. RFR also plans to convert approximately 30,000 square feet of the lower level from an existing parking garage into retail space that can be combined with a small portion of the ground floor for a street-level entrance.

In addition to RFR's strategy for three floors of retail, the company has significant plans for the office portion of the building. Traditionally, the office floors of 1328 Broadway were leased in small parcels of under 1,000 square feet to mostly shoe designers for showroom space. In an effort to attract full-floor and multi-floor tenants, RFR has already begun to consolidate the building's existing tenants onto one or two multi-tenanted floors, and will make available up to 200,000 square feet of contiguous space.

RFR has also begun a complete rehabilitation of the property that will include the replacement of all of the building's mechanical and electrical systems, as well as other upgrades.