This New York pop-up shop has Intel inside

Chipmaker Intel has a new Manhattan pop-up shop at a location that perhaps packs the best of both worlds: high foot traffic and rent at a discount against what it would have to shell out on blocks nearby.

The Intel Experience Store, located at the base of the 1251 Avenue of the Americas office tower, opened to the public Thursday, the first of the Santa Clara, California-based company’s global pop-ups to debut in cities that include London, Munich, Paris and Seoul for the holiday shopping season.

Intel plans to feature PCS and laptops at the locations made by technology partners including ASUS, Acer, Dell, Google, Microsoft and HP. The computers, of course, all show off the capabilities of Intel's chips inside — just like the company's famed slogan. Customers can try out the chips' performance, particularly when playing graphic-intense games, and place an order online.

The New York store, between 49th and 50th streets, sits right across from the iconic Rockefeller Center and diagonally from Radio City Music Hall. The Fifth Avenue shopping stretch is a block to the east, and the tourist-and-entertainment hub of Times Square is a block to the west.

Tech companies have regularly used pop-up shops or permanent retail stores to introduce products or drive consumer engagement with mixed results.

For instance, while Apple Stores are a big part of the iPhone maker's sales and branding strategy, Microsoft shut its 80-plus retail stores during the pandemic. Microsoft only has two brick-and-mortar locations left, including a New York "experience center" at 677 Fifth Ave. less than a mile from the Intel shop and a visitor center in its hometown of Redmond, Washington, according to its website.

Intel moved into its temporary New York retail space, spanning about 20,000 square feet across the ground floor and lower level, as it became available for the first time in decades. It had been used as a bank branch for 55 years, most recently a JPMorgan Chase location, until closing last year, according to Ken Hochhauser of RTL, the brokerage representing landlord Mitsui Fudosan America in seeking a permanent retail tenant.

While Avenue of the Americas, also known as Sixth Avenue, may not be considered a key Manhattan retail corridor, 1251 Avenue of the Americas draws sizable foot traffic, Hochhauser said in an interview. CoStar data shows the tower spans 2.4 million square feet and counts among major office tenants law firm DLA Piper and financial services firm Natixis.

“It’s visibility and exposure,” Hochhauser said, adding over 37 million people pass by the building every year. The retail location, which features an outdoor plaza and fountain that often draws tourists, also is the only one in the city where a tenant can set up both inside and outside, he said.

“That outdoor area allows you to drive a lot of social media engagement and virality,” Hochhauser said. “Just think of introducing a basketball shoe on a ball court outdoors in front of 250,000 people who are around there at any given moment. Think of the virality of that, the social media exposure. … [A brand has] unparalleled opportunity to connect directly with consumers. … No retailer that I know of has the ability to program private property this large and this visual.”

A case in point, a blue cube with the Intel logo has been installed in the fountain for the pop-up that runs through Nov. 30.

While he declined to give Intel’s deal terms, Hochhauser said comparable retail rent on Sixth Avenue is about $250 per square foot — a “deep discount” to that of Fifth Avenue and Times Square. Intel didn’t respond to a CoStar News request seeking comment.

For comparison, third-quarter asking rent on Fifth Avenue averaged close to $2,300 per square foot while the Times Square area averaged about $1,600, a Cushman & Wakefield study found.

“While Sixth Avenue may not have that co-tenancy, and traditionally it really hasn't, it's the same marketplace, the same customer as Fifth Avenue and Times Square," Hochhauser said.

That combination of foot traffic and lower rent has attracted “a lot of interesting tenants,” Hochhauser said, adding the space “would benefit a variety of brands across industries” including fashion, retail and automotive.

Andrew Kahn, Cushman & Wakefield’s executive managing director of retail services, represented Intel.