Costco debuts in Manhattan with store opening

Issaquah, Wash. Costco Wholesale Corp. announced it is opening its first store in Manhattan on Thursday, and added it is looking for additional sites in the area.

The warehouse club retailer said it searched for a Manhattan site for years to target the island’s higher-income population. The new store sits on the site of a former wire factory in Forest City Ratner’s East River Plaza project, which also includes Target and Marshalls.

The East River store, which the retailer expects will be its highest-volume store within three years, is the fourth within New York City limits, with the others in Brooklyn, Queens and Staten Island.

Another store will open next year in Queens, the company said.

One of Costco’s main challenges in building the East River store came from building in an urban setting. Most of the chain’s U.S. stores lie in suburban in rural areas. While a typical Costco store is more than 140,000 sq. ft., the Harlem store is about 110,000 sq. ft.

“It’s a challenge relative to the size,” Costco CEO Jim Sinegal told Drug Store News. “We had to crowd a lot in and configure it differently.”

One way the store saved space was to trim down some of the products, particularly those that would not be suitable for most New Yorkers, such as patio furniture and larger packages of such products as pet food.

Early on, another challenge came from elected officials, who criticized Costco for building the store in Harlem, a largely low-income neighborhood relative to the rest of Manhattan, despite the chain’s longstanding policy of not accepting food stamps.

In response, the company had initially announced, in May, that it would accept food stamps at its New York stores, through a pilot program, but ended up announcing in late October that it would accept them at all its stores nationwide.