real estate investment trust
A real estate investment trust (REIT, pronounced "reet") is a company that owns, and in most cases operates, income-producing real estate. REITs own many types of real estate, including office and apartment buildings, studios, warehouses, hos ...
that owns 7 properties in
New York metropolitan area
The New York metropolitan area, also called the Tri-State area and sometimes referred to as Greater New York, is the List of cities by GDP, largest metropolitan economy in the world, with a List of U.S. metropolitan areas by GDP, gross metropo ...
department store
A department store is a retail establishment offering a wide range of consumer goods in different areas of the store under one roof, each area ("department") specializing in a product category. In modern major cities, the department store mad ...
chain that included 16 stores at its peak in 1981 before it filed for
bankruptcy
Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the deb ...
in 1992. Six of Alexander's 11 stores (at the time of the 1992 bankruptcy) were located in buildings owned by the company. Locations included a store that occupied the entire block between East 58th and 59th streets and Lexington and Third Avenues in
Manhattan
Manhattan ( ) is the most densely populated and geographically smallest of the Boroughs of New York City, five boroughs of New York City. Coextensive with New York County, Manhattan is the County statistics of the United States#Smallest, larg ...
The Bronx
The Bronx ( ) is the northernmost of the five Boroughs of New York City, boroughs of New York City, coextensive with Bronx County, in the U.S. state of New York (state), New York. It shares a land border with Westchester County, New York, West ...
, and a store in
Paramus, New Jersey
Paramus ( Waggoner, Walter H, ''The New York Times'', February 16, 1966. Accessed October 16, 2018. "Paramus – pronounced puh-RAHM-us, with the accent on the second syllable – may have taken its name from 'perremus' or 'perymus,' Indian for ...
that featured one of the largest murals in the world.
History
In 1928, George Farkas, a
Brooklyn
Brooklyn is a Boroughs of New York City, borough of New York City located at the westernmost end of Long Island in the New York (state), State of New York. Formerly an independent city, the borough is coextensive with Kings County, one of twelv ...
native, opened a store on Third Avenue in
the Bronx
The Bronx ( ) is the northernmost of the five Boroughs of New York City, boroughs of New York City, coextensive with Bronx County, in the U.S. state of New York (state), New York. It shares a land border with Westchester County, New York, West ...
with $7,500 (~$ in ) and named it for his deceased father, Alexander. Catering to the well-to-do
middle class
The middle class refers to a class of people in the middle of a social hierarchy, often defined by occupation, income, education, or social status. The term has historically been associated with modernity, capitalism and political debate. C ...
private label
A private label, also called a private brand or private-label brand, is a brand owned by a company, offered by that company alongside and competing with brands from other businesses. A private-label brand is almost always offered exclusively by th ...
goods. Its advertising slogan at one time was "You'll find Alexander's has what you're looking for; how lucky can you get?!"
The chain thrived even during the
Great Depression
The Great Depression was a severe global economic downturn from 1929 to 1939. The period was characterized by high rates of unemployment and poverty, drastic reductions in industrial production and international trade, and widespread bank and ...
The Bronx
The Bronx ( ) is the northernmost of the five Boroughs of New York City, boroughs of New York City, coextensive with Bronx County, in the U.S. state of New York (state), New York. It shares a land border with Westchester County, New York, West ...
in 1933. At its heyday in the 1930s, this store was known for its discount bargains and had more sales per square foot than any other store in the United States.
Farkas was known for being a master at selecting locations for his stores, buying the real estate instead of leasing.
In February 1959, the company opened a store in Rego Park, Queens.
In 1963, the company opened its flagship store on 59th street in Manhattan after it bought the land from a company controlled by Joseph P. Kennedy Sr. for what seemed like a high price of $125 (~$ in ) per square foot.
In December 1968, Alexander's became a
public company
A public company is a company whose ownership is organized via shares of share capital, stock which are intended to be freely traded on a stock exchange or in over-the-counter (finance), over-the-counter markets. A public (publicly traded) co ...
via an
initial public offering
An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investm ...
, raising $41.17 million (~$ in ), in part to prevent a takeover from competitor E. J. Korvette. Founder George Farkas retired that year due to failing health and one of his sons, Alexander S. Farkas, became CEO.
In the 1970s, customers defected to larger competitors such as Macy's and Bloomingdale's, and discount stores such as Kmart.
Alexander's opened its 10th store on October 15, 1971 in the Roosevelt Field shopping mall.
Upon completion of The Mall at the World Trade Center in 1974, Alexander's became its anchor store. The location occupied roughly 1/6 of the WTC's 500,000 square foot mall, the largest in New York City, and was located underneath 4 World Trade Center, immediately to the east of the south tower.
In 1980, after a proxy fight, Interstate Properties, controlled by Steven Roth, took control of the company, seeking to maximize the value of its real estate.
In 1981, management attempted to expand offerings beyond leisure apparel.
In 1984 at the request of Interstate Properties, then holding a 13% stake, Alexander Farkas resigned as CEO and was succeeded by his brother, Robin (1933-2018).
In 1986,
Donald Trump
Donald John Trump (born June 14, 1946) is an American politician, media personality, and businessman who is the 47th president of the United States. A member of the Republican Party (United States), Republican Party, he served as the 45 ...
bought approximately 20% of the company.
Closure and real estate business
1987 was the last year in which the company made a profit from its retail operations.
In 1988, Interstate and Trump each raised their stakes to 27% of the company, but Trump pledged his interest as collateral for a personal loan from Citibank, and in 1991 was forced to turn over his holdings to the guarantor.
In 1992, Roth and creditors forced the company into bankruptcy and the company shut all 11 stores on May 15, 1992, laying off 5,000 people. The bankruptcy was also triggered by a
put option
In finance, a put or put option is a derivative instrument in financial markets that gives the holder (i.e. the purchaser of the put option) the right to sell an asset (the ''underlying''), at a specified price (the ''strike''), by (or on) a ...
Gruss family held to sell its 18% interest in the partnership that owned the 59th street store to Alexander's for $35 million and the company did not have the money.
In 1993, the company emerged from bankruptcy. The combination of an increase in value in its real estate holdings and shedding of its liabilities caused its stock to skyrocket from $8.50 per share before it declared bankruptcy to $57 per share a year later.
In 1995, Vornado Realty Trust bought the interest from Citicorp (formerly owned by Donald Trump) for $54.8 million.
In November 2012, the company sold the Kings Plaza mall in Brooklyn to Macerich for $751 million and used the proceeds to pay a $122 per share
dividend
A dividend is a distribution of profits by a corporation to its shareholders, after which the stock exchange decreases the price of the stock by the dividend to remove volatility. The market has no control over the stock price on open on the ex ...
to stockholders.
Mural at the Paramus store
One of the more famous things associated with Alexander’s was an abstract art mural painted on glass with enamel by Polish artist Stefan Knapp that was displayed on the outside of the Alexander’s location opposite Garden State Plaza in
Paramus, New Jersey
Paramus ( Waggoner, Walter H, ''The New York Times'', February 16, 1966. Accessed October 16, 2018. "Paramus – pronounced puh-RAHM-us, with the accent on the second syllable – may have taken its name from 'perremus' or 'perymus,' Indian for ...
. The mural was hung on the side of the building facing New Jersey Route 4 and remained there until the building’s demolition in 1998.
George Farkas had approached artist
Salvador Dalí
Salvador Domingo Felipe Jacinto Dalí i Domènech, Marquess of Dalí of Púbol (11 May 190423 January 1989), known as Salvador Dalí ( ; ; ), was a Spanish Surrealism, surrealist artist renowned for his technical skill, precise draftsmanship, ...
to paint a mural for the Paramus location and the two had agreed to terms on a contract. However, sometime after that, Farkas was traveling abroad and came across a mural painted by Knapp while walking through London’s
Heathrow Airport
Heathrow Airport , also colloquially known as London Heathrow Airport and named ''London Airport'' until 1966, is the primary and largest international airport serving London, the capital and most populous city of England and the United Kingdo ...
and decided to commission him to paint a mural as well. Dalí demanded that he do the piece, which would include giraffes with drawers suspended from their necks hanging out over the street, and was willing to let Knapp paint the giraffes. Farkas responded by giving the job to Knapp in its entirety, but still paid Dalí for his input. Knapp’s theme was a map of the world painted as he viewed it during his time as a pilot in the
Royal Air Force
The Royal Air Force (RAF) is the Air force, air and space force of the United Kingdom, British Overseas Territories and Crown Dependencies. It was formed towards the end of the World War I, First World War on 1 April 1918, on the merger of t ...
after his emancipation from a Soviet prison camp.
When it was completed in 1963, the 280-panel mural was the largest in the world, measuring 200 feet by 50 feet and weighing over 250 tons. Farkas was enamored with the work and hired Knapp to paint murals at Valley Stream and White Plains stores.
The store was closed in 1992 and the building sat unused. In 1996, Steven Roth, the chairman of Vornado Realty Trust, announced that the store would be redeveloped into a
shopping center
A shopping center in American English, shopping centre in English in the Commonwealth of Nations, Commonwealth English (see American and British English spelling differences#-re, -er, spelling differences), shopping complex, shopping arcade, ...
anchored by
Ikea
IKEA ( , ) is a Multinational corporation, multinational conglomerate (company), conglomerate founded in Sweden that designs and sells , household goods, and various related services.
IKEA is owned and operated by a series of not-for-profit an ...
. Will Roseman, mayor of nearby
Carlstadt, New Jersey
Carlstadt is a Borough (New Jersey), borough in Bergen County, New Jersey, Bergen County, in the U.S. state of New Jersey. As of the 2020 United States census, the borough's population was 6,372, an increase of 245 (+4.0%) from the 2010 United S ...
and a director of the Bergen Museum of Art & Science contacted Roth in an attempt to save the mural. After it was appraised by
Sotheby's
Sotheby's ( ) is a British-founded multinational corporation with headquarters in New York City. It is one of the world's largest brokers of fine art, fine and decorative art, jewellery, and collectibles. It has 80 locations in 40 countries, an ...
the mural was donated to the Bergen Museum of Art & Science, which stored it in a garage in Carlstadt.
In June 2015, pieces of the mural were displayed at the Art Factory in
Paterson, New Jersey
Paterson ( ) is the largest City (New Jersey), city in and the county seat of Passaic County, New Jersey, Passaic County, in the U.S. state of New Jersey.