The biggest empty store in Downtown Crossing won’t be empty for much longer.
Japanese clothing retailer Uniqlo has signed a lease for 25,000 square feet across two floors of the former Barnes & Noble building at 399 Washington St. Interior renovations will start in the coming weeks, with the clothing store set to open in mid-2026.
The new owners of the five-story building secured the lease with Uniqlo over the summer, just months after buying it. (Uniqlo announced it via a Fast Company article about its aggressive store opening plans in the US.) They still need to fill around 50,000 square feet, including upstairs office space and a basement level, but remain hopeful based on the interest shown by potential tenants.
The lease — in a high-profile building that has been vacant since 2006 — is a big milestone for Downtown Crossing as it rebounds from a big drop in foot traffic during the COVID-19 pandemic. Coincidentally, another Japanese retailer, Teso Life, is preparing to open its first New England store at nearby 459 Washington St., the site of a former Forever 21 store.
With those leases and a few others underway, Downtown Business Alliance president Michael Nichols said there are “virtually no available storefronts” along Downtown Crossing’s main spine of Washington Street between City Hall Plaza and Chinatown. Empty spaces remain at the former Felt building and in multiple buildings on the corner of Bromfield Street, a block whose owner is planning to redevelop as a residential tower.
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Notably, other pockets of downtown have not been as successful, and empty storefronts abound throughout the neighboring Financial District.
While foot traffic through the district remains about 75 percent of pre-pandemic levels, Nichols said retailers are recognizing it’s a good time to set up shop downtown.
“These companies see the new normal having been established,” Nichols said. “To many, that’s an appropriate measure to put a stake in the ground.”
In the case of the Barnes & Noble building, previous owners LaSalle Investment Management and L3 Capital pumped millions of dollars into renovations after buying it in 2017 for $63 million. That work finished in 2021, but they had trouble finding occupants amid the pandemic. Lender Wells Fargo took control, and put the building up for sale in 2024.
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Boston-based Hudson Group and New York-based Assembly Investments ended up partnering to buy the building in March, for just $13 million. The lease with Uniqlo then came together quickly, and the lower purchase price gave the new owners leeway to offer a competitive rent. (The Uniqlo chain, a division of Tokyo-based Fast Retailing, is also on Newbury Street and previously had a location in Faneuil Hall Marketplace.)
“It’s a great location that was just waiting for the right time,” Hudson partner Noam Ron said.
Assembly founder Evan Papanastasiou said they acquired the property knowing there was “a supply-demand imbalance of big box retail space” downtown — with more retailers seeking spots with at least 20,000 square feet than there are vacancies of that size.
“We just have conviction on how retailers are viewing the Boston market and the downtown market specifically,” Papanastasiou said.
Ron also cited the city’s new zoning rules allowing taller residential towers to be built in the district and the Downtown Business Alliance’s activation efforts as positive factors for prospective retail tenants.
“We could tell there’s a really positive momentum shift downtown,” Ron said. “This is one more really big step along that way.”
Jon Chesto can be reached at jon.chesto@globe.com. Follow him @jonchesto.