VW buys's flagship GM dealership for $125 million.
Discussion
Volkswagen Group of America is expected to sign an agreement today to buy the Potamkin family’s massive dealership in Manhattan and convert it into flagship VW and Audi stores.
VW confirmed plans to buy the 265,000-square-foot store at 11th Avenue and 56th Street from Potamkin Auto Group. The building currently houses Potamkin GM, which has Cadillac, Chevrolet, Buick, GMC, Hummer and Saab franchises.
The Potamkins are moving the six franchises five blocks south on 11th Avenue into a smaller store that housed Potamkin Honda, said Robert Potamkin, who owns the Potamkin Auto Group with his brother Alan.
Potamkin said VW will spend about $125 million for the property, with about a third of that going toward renovation of the site.
Potamkin GM sells about 1,500 new vehicles annually, said Robert Potamkin.
Potamkin said the brothers are selling the Honda franchise and moving the GM operations because property is often worth more than an auto franchise in New York. “In most places, the franchise is the dog and the real estate is the tail,” he said. “In Manhattan, the real estate is the dog and the franchise is the tail.”
The new VW store is expected to open next spring and the Audi store in late 2011. Both will have new showroom concepts for the brands.
The new stores are part of VW’s “aggressive plan to increase sales in the U.S.,” VW of America President Stefan Jacoby said in a draft press release.
“There is no better place to demonstrate our commitment than in New York City,” he said.
VW confirmed plans to buy the 265,000-square-foot store at 11th Avenue and 56th Street from Potamkin Auto Group. The building currently houses Potamkin GM, which has Cadillac, Chevrolet, Buick, GMC, Hummer and Saab franchises.
The Potamkins are moving the six franchises five blocks south on 11th Avenue into a smaller store that housed Potamkin Honda, said Robert Potamkin, who owns the Potamkin Auto Group with his brother Alan.
Potamkin said VW will spend about $125 million for the property, with about a third of that going toward renovation of the site.
Potamkin GM sells about 1,500 new vehicles annually, said Robert Potamkin.
Potamkin said the brothers are selling the Honda franchise and moving the GM operations because property is often worth more than an auto franchise in New York. “In most places, the franchise is the dog and the real estate is the tail,” he said. “In Manhattan, the real estate is the dog and the franchise is the tail.”
The new VW store is expected to open next spring and the Audi store in late 2011. Both will have new showroom concepts for the brands.
The new stores are part of VW’s “aggressive plan to increase sales in the U.S.,” VW of America President Stefan Jacoby said in a draft press release.
“There is no better place to demonstrate our commitment than in New York City,” he said.
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