As music sales continue to decline, the industry faces yet another blow. The Times Square Virgin Megastore, renowned as the highest volume music retailer in the United States, will close this spring.
Talks of the major closing began nearly two years ago.
The store has been at the center of speculation since August 2007 when the Virgin Entertainment Group North America was acquired by two real estate companies — the Related Cos. and Vornado — in a joint venture. (Billboard)
Virgin’s closing is reportedly based on property financing.
The store is being closed because its current owners can lease the space more profitably to another tenant. Virgin paid just $54 per sq ft in rent for the location, whereas the market rent in the area was about $700. Virgin has been the only major music chain in New York since 2004, when Tower Records declared bankruptcy and HMV pulled out of the US market. (BBC)
A lower Manhattan Virgin Store will now be the main location.
The closure leaves the Virgin chain with five stores, and one of them, the Union Square store in New York, will now be the city’s premiere record store, with an estimated $40 million annual volume. But the status of that store is also at question as the Related Cos. and Vornado leased the ground floor of the store to Nordstrom Rack for the holiday season, only to have the deal fall through. (Reuters)
The current Times Square location is scheduled to close this April.