Sunday Summary: Are GLP-1s Affecting Retail? Oh, You Better Believe They Are.

The real estate version of the “butterfly can flap its wings in Peking, and in Central Park you get rain instead of sunshine” goes something like this: Eli Lily introduces a GLP-1 for weight loss — the local Pizza Hut becomes a Pilates studio.

At least that’s the takeaway for retailers from the barrage of new weight-loss drugs. One recent study found that people on GLP-1s have reduced their spending at fast-food joints, coffee shops, and other limited-service outlets by 8 percent, and their spending on sweets by as much as 10 percent. Companies like J.

M. Smucker (which makes Hostess snacks) have seen six straight quarters of decline. Restaurants like Hooters and TGI Fridays have filed for bankruptcy in the last two years, and chains like Wendy’s, Jack in the Box, Denny’s, Outback Steakhouse, Red Robin and Pizza Hut have all closed locations.

At the same time, Placer.ai has found that shopping at organic, healthy markets has risen steadily since 2022, and gyms are getting traffic beyond the one-time New Year’s resolution visit.

“Historically speaking, most gyms can expect to lose 20 to 30 percent of those members,” said R.J. Hottovy, head of analytical research at Placer.ai. “But, according to publicly reported numbers by some of these chains, that’s changed quite a bit. You still see some attrition, but it’s a lot less than it once was. We’ve really seen that membership attrition curve flatten out.”

Retail trends shift

Indeed, this has begun to percolate into the real estate deals being inked.

“Wellness and fitness-related concepts are some of the most active in the marketplace right now — boutique wellness, med spas, recovery concepts and large-format gyms like Equinox,” said Ripco Real Estate’s J.P. Pirraglia.

This is just one of the stranger retail stories out there, but we found a lot of interesting ones in our recent retail issue — like, say, the way that luxury retailers are trying to lure Gen Z’ers with their siren song of collaboration with cheaper brands and social media prowess.

“You have all of this access to information now, and you have all this social media online,” said Andrew Goldberg, a vice chairman at CBRE. “So you can go to Instagram, and you can see exactly who’s trending and who’s following who.”

Indeed, H Mart might be able to attribute some of its success to the fact that they’ve got pretty good social media prowess.

“I went to H Mart because I’ve been seeing so many viral things online and I had to try them for myself,” said Linda Vo, aka TikTok’er @itslindavo in an online clip earlier this year. The retailer has begun a major expansion into the Sun Belt — and it’s not every grocery store that has a best-selling memoir associated with it, which couldn’t have hurt.

Experiential retail grows

The other big branch of retail that has been thriving has been experiential.

“It’s really about providing a place where storytellers can tell a story,” said Winston Fisher, of Fisher Brothers, who has among the more interesting experiential venues with Area 15 in Las Vegas. “It’s not the old days of real estate where you would set up an anchor tenant, they would drive traffic, and people would just live off it. In our case, we’re setting up a place that’s about the consumption of entertainment and the consumption of memories.”

A tall order — but the retailers who are up to the challenge have been successful.

Case No. 1: Empire State Realty Trust is looking to sell 1359 Broadway (which is 95 percent leased) for around $225 million.

Case No. 2: BXP hired Eastdil Secured superbrokers Will Silverman and Gary Phillips to sell the ground lease at 7 Times Square for somewhere between $700 million and $750 million.

Case No. 3: Property & Building Corporation’s 865,000-square-foot 10 Bryant Park (also known as the HSBC Tower) is being marketed for a whopping $800 million-plus.

Some of the prices for these properties are below what they might have gotten pre-COVID, but none of them look like the distressed properties that a lot of investors were expecting over the last few years, and which never quite materialized.

“It might be the dead of summer, but our team is, of course, hard at work — this is truly when we shine the brightest, are completely dialed in on our business plan, and outwork the marketing,” said Marc Holliday on SL Green Realty’s earnings call.

Earnings reports released

Holliday could boast $264 million in total revenue (a nice rise from $241 million in the second quarter of 2025) and a 94.7 percent occupancy rate in SL Green’s New York properties. (No surprise given that we’re seeing all these leases, like Ryan Specialty renewing and Solil Management taking a five-and-a-half-year lease at 1185 Avenue of the Americas. It might be a good section of town. The Durst Organization also announced three leases at 1133 Avenue of the Americas, three blocks away. Oh, and SL Green also rented 98,420 square feet to the AI firm Legora at 11 Madison Avenue.)

Blackstone also reported in, and its results were fittingly fantastic: The company exceeded 20 percent year-over-year growth in total revenues, fee revenues, fee-related earnings, net realization and distributable earnings. Capital inflows reached $70 billion, and the firm’s assets under management sits at a dizzying $1.35 trillion. (Hey, nobody likes a showoff, Blackstone.)

One of the big pieces of news last week was that a group of New York City landlords is suing the Rent Guidelines Board over the rent freeze the board approved earlier this year.

“The RGB failed to meet its legal mandate of setting rent adjustments based on its own data and research, which strongly justified a rent increase,” said Ann Korchak, board president of Small Property Owners of New York (SPONY), a plaintiff in the suit. “The rent freeze was illegal. The process was illegal and stacked against small owners of rent-stabilized properties. We are hopeful the court will address this injustice.”

But, while the RGB suit has been the chatter of the day, a somewhat more under-the-radar story for Gotham has been the effect of the labor agreement reached a few months ago between the Hotel Association of New York City and the Hotel and Gaming Trades Council for 27,000 hotel workers, which would set up housekeepers and non-tipped staff to receive salaries of over $100,000 in the next eight years.

“Every deal that looks good on its surface deserves a second look and a deeper dive and, in this case, it just means knowing how the regulatory environment is changing and knowing what the contracts say,” said Solomon Garber of Erithmitic. “I think lenders should lean into New York hotels and they shouldn’t shy away from union deals, but they have to do a lot more work and have a lot more resources to understand what all the latest changes are, and then [they] have to read the contract and bake in some big conservatism.”

First, there’s the conversation CO had with legendary California industrial developer Brett Dedeaux to discuss the state of logistics real estate.

Second, CO took a look at what New York Gov. Kathy Hochul’s recent moratorium on data center development will mean for an industry that was kinda, sorta, depending on it.