Moving on up: Toyota-Lexus dealer transforms a Manhattan high-rise

NEW YORK — Dealers will make any number of accommodations to sell and service cars in crowded, expensive urban environments.

And then there is the multistory monument to dealer innovation that John Iacono and his partners at BRAM Auto Group have built in the Hell's Kitchen neighborhood on the west side of Manhattan.

The tremendously expensive project, which took almost a decade to bring to fruition, consists of nearly identical dealerships — Lexus of Manhattan and Toyota of Manhattan — sharing the fourth floor of a multiuse building with sweeping, stunning views of the Hudson River.

Just how imaginative is it?

The used cars are on the roof, the new cars are in New Jersey, and the more than 200 vehicles in line for service on any given day are stacked three high and three deep on racks like a kid's giant Matchbox set.

Meanwhile, there is a customer cafe — which would be operating if not for COVID-related restrictions — amid the twin delivery areas. There is a 52-bay joint service area on the third floor bathing in natural light. And every new vehicle purchaser gets a golf cart tour of the facility.

To help the project make economic sense, FedEx leases a big space downstairs that it uses as a staging area. There is also a public event space with capacity for 2,000 people on the sixth floor. And the infrastructure and approvals are in place to build what eventually will be 35 floors of high-end apartments on top of the existing seven floors.

"That is the plan," says Iacono, co-president of BRAM Auto Group. His family emigrated from Sicily when he was a child, and his partners include his younger brother, Ignazio, and his sons Sal and Robert. It's one way to make automotive retail work in densely packed areas where space is at an inflated premium.

"You can't build an automobile dealership alone in an urban environment that resembles that of a suburban-type of business model. You have to look at it in a very different way. An urban build-out is vertical," said Iacono, 63.

Few pieces of BRAM's Manhattan operations are as innovative and interesting as the process by which it retails new vehicles.

The Toyota and Lexus stores have traditional-looking, glass-walled facades located across a central tile-covered "street" inside the fourth floor. Inside each of the dealerships are representatives of each nameplate in that brand's lineup, making up the bulk of the stores' on-hand inventory.

Sales associates work from common tables, sharing large screens with customers seated with them. Once a customer chooses a nameplate, the associate uses the screen to roll through BRAM's inventory, six miles away in a series of indoor and outdoor storage areas in North Bergen, N.J.

Vehicle information and pricing details are displayed using Toyota's homegrown SmartPath and Monogram digital retailing systems.

When a customer chooses a vehicle, it goes through a final wash in North Bergen and is driven into the city by a porter via the Lincoln Tunnel to be delivered, where it will eventually be seen by its owner for the first time.

BRAM pays its cadre of drivers a flat fee of $42 to bring a vehicle into the city, and the porters either drive back in a trade-in or are shuttled back, said Tommy Acciarello, who manages the North Bergen logistics operation. The trip in can take as little as 15 minutes — or considerably longer during rush hour.

"We do what we can to make sure we're bringing them in when traffic is light, but sometimes, it can't be helped," Acciarello said, adding that the setup has allowed the stores to deliver as many as 141 new vehicles in a single day across six of the group's 14 dealerships.

The North Bergen storage and prep areas, which have capacity to store up to 4,000 vehicles, also feed four other BRAM stores in New York City: two other Lexus stores, as well as Audi and Cadillac. Almost 1,500 of the North Bergen campus' storage capacity is indoors, and with inventories still lean, BRAM is currently leasing its 2,500-vehicle outdoor yard to trucking companies to store their excess trailers.

From this lean, digital-centric setup, Lexus of Manhattan has averaged about 100 new-vehicle sales a month, while Toyota of Manhattan now delivers about 150 per month, Iacono said.

To win approval from Toyota Motor North America for the two stores' combined operations, Iacono says BRAM operates both as if they were Lexus stores with its spirit of omotenashi. The uncommon courtesy is winning newfound friends among his Toyota customers.

"It's expected in the premium brands. It's not expected in the mass market, and when a mass-market customer gets treated in a way that they did not expect, the impact is just immense," the soft-spoken Iacono said.

If the method that the BRAM stores use to deliver new vehicles seems like a dance, then the way they prepare to service their customers' vehicles is the Bolshoi Ballet.

When a customer drives into the dealerships from the entrance along West 49th Street, they immediately climb in a helix up to the fourth-floor receiving area, with its gray tiled floor, its expansive windows looking out over the Hudson and the twin facades of the two dealerships. If they're there to buy or for service, their vehicles are parked in an adjacent room equipped with 70 three-vehicle lift towers and are given a little plastic numbered hat so they can be located quickly.

With an average of 2,000 repair orders per month, the service write-up areas are a series of individual walled offices located within the two dealerships and just inside the entrance, each equipped with a single TV screen upon which service prices are displayed. When it's time to service that vehicle, it is removed from the racks and ported down a ramp to one of the 52 well-lit and neatly maintained service bays on the third floor.

But the racks can present their own problem.

"One of the biggest challenges that we have is having people pick up their vehicle after a service visit. For a lot of them, it's cheaper to just hold it over here" so they don't have to pay for additional parking in the city, said Iacono's son Robert.

"Loaner cars aren't so popular in Manhattan," his father added.

The dealerships stock a supply of the most frequently used parts and materials, including a two-story vertical carousel of tires. However — similar to the sales operation — they rely on a BRAM-owned central distribution facility in nearby Queens for other parts. The union-represented technicians own their own tools, but BRAM supplies each bay with a matching black toolbox in which to store them. Technicians also have a large break room and locker rooms nearby.

The full cost of the project isn't yet complete because of the pending residential tower. And while Iacono wouldn't discuss specifics, he said it is already in the high nine figures.

"New York real estate and New York real estate development and construction is some of the most expensive in the world," he said. Toyota Financial Services helped to finance the project.

Andrew Gilleland, senior vice president of automotive operations with Toyota Motor North America, said the BRAM project, while unusual, was mutually beneficial. "It's a win-win for us, the dealer and our customers, and ensures we have a mutually secure future in these markets in which real estate is extremely expensive."

The key to making the whole project "pencil," according to Iacono, was the decision to embrace a multiuse building that could be shared with other tenants, ultimately including residential ones, along with an inadvertent assist from 2012's Hurricane Sandy. It was the aftermath of that devastating storm that helped BRAM originally acquire what was then a two-story, one-square-block piece of commercial real estate from one of the city's largest residential real estate development firms, TF Cornerstone, Iacono said.

Over the next eight and a half years, BRAM's plans and designs changed multiple times, and construction was stretched out by the pandemic before the combined stores finally opened in September 2021.

"The biggest headache was, No. 1, navigating through the approval processes in the city, and then came the unexpected, which was COVID and construction being stopped," Iacono said. "The [construction] supply chain not being there; not being able to bring back the subcontractors because of the issues that they had; materials were unavailable, and by the way, the cost at the end of the day went really the wrong way."

In all, BRAM added five stories above the existing footprint, occupying two of those five with the two dealerships, and leasing the sixth floor to The Glasshouse, a private event venue. The fifth floor is currently open and in the process of being rented, Iacono said. But the whole project is already cash positive because of the mixed-use development.

"In order for us to make the automotive piece work, we had to build a facility with nonautomotive uses. Because we had so many other pieces of the projects, that made the dealerships work from an income standpoint," Iacono said. "At the end of the day, it all pencils, when you put it all together. And it allows us to honor our partners, Lexus and Toyota, and represent them in a way that they deserve, given all that they have done for our family over the years."