Lord & Taylor Sells Fifth Avenue Flagship For $850 Million

MIDTOWN MANHATTAN, NY — Co-working company WeWork has closed a deal to purchase the Fifth Avenue flagship store of Lord & Taylor for $850 million, the companies announced in a joint press release Tuesday.

WeWork will use the Fifth Avenue department store building — located between West 38th and 39th streets and famed for its holiday window displays — for its New York headquarters, the company announced. Lord & Taylor will continue to operate its flagship department store through the 2018 holiday season, according to a press release.

But there's some good news for Lord & Taylor fans. The store won't be completely gone once WeWork moves into the building. After the 2018 holiday season Lord & Taylor will lease 150,000-square-feet of space in the building for a redesigned retail store, according to a press release.

Watch: WeWork buys Lord & Taylor flagship store for $850 million

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The sale of the Fifth Avenue department store was one of several "strategic transactions" made between WeWork, private equity firm Rhône Group and Canadian-based Hudson's Bay Company, which owns Lord & Taylor. Other agreements include WeWork leasing space in Hudson's Bay Company stores around the world and a $500 million equity investment by the Rhône Group in Hudson's Bay Company.

The sale of the Fifth Avenue Lord & Taylor flagship will help "monetize" the retail location, Hudson's Bay Company Interim CEO Richard Baker said in a statement.

WeWork Founder and CEO Adam Neumann said that the purchase of the Fifth Avenue department store and the creation of a New York City headquarters will help the co-working company firm up its roots in the city.

"WeWork could not be what it is today if it wasn’t for our New York roots. The WeWork of today is a testament to the energy and hustle of this great city and it permeates everything we do," Neumann said in a statement. "The acquisition by WeWork Property Advisors of the Lord & Taylor flagship building on Fifth Avenue is a statement of intent and commitment by WeWork to New York City."

Lead image by AP Photo/Mark Lennihan, File