Retail Chains Abandon Manhattan: ‘It’s Unsustainable’

[park123]

More generally, it kind of makes sense to me that the boroughs are holding up better than Manhattan. If people work from home, well Manhattan is the gigantic job center, shopping and dining and nightlife center, and the boroughs are largely residential. More people working from home and not leaving the neighborhood suggests that Park Slope and Astoria and Jackson Heights are doing better than Manhattan. I haven't been to the boroughs since Covid-19 started, so I don't actually know how they are. I have been all over Manhattan extensively.

Midtown is not NYC's "downtown". Manhattan is NYC's downtown. And as such Manhattan as a whole is suffering worse than the residential areas outside, I would imagine.

The other thing is that the residential that does exist in Manhattan is much more expensive than in the boroughs, with a few relatively small exceptions in Brooklyn. People in Manhattan are thus much more likely to be able to escape to 2nd houses. I don't think many of the working immigrants in Queens or non-brownstone Brooklyn temporarily moved to cottages in the Hamptons or the Hudson River Valley. They're still there, still spending money (at least until the $600 unemployment ran out). Meanwhile Manhattan not only has no office workers or tourists, but half the residents left as well.

[maru2501]

I think covid gets solved. The bigger change might be the complete shift in office sites.

I know of more than one friend whose company has basically decided everyone can work from home, now that they were forced to do it. Others expect a drastic drop in the amount of space they need, basically just keeping enough room to have period in-person meetings if they are necessary.

SF also seeing drops in pricing, although it was so insanely high to start, maybe that's not a shocker

[jd3189]

Hopefully COVID just leads to a good reset for NYC with crime only rising moderately or minimally. As people have mentioned, it will allow the city to find itself again after years of safe but bland gentrification, billionaire towers, and just the soul of the city being crushed. The people who remain and have been there since the rough days of the 80s and early 90s will continue to live their lives in the outer boroughs.

[the urban politician]

I'm going to throw in my prediction:

Fall 2021, on SSP:

Everybody will be talking about how vibrant and thriving our great center cities are again.

This will end up being a giant blip in the radar

[park123]

Originally Posted by jd3189

Hopefully COVID just leads to a good reset for NYC with crime only rising moderately or minimally. As people have mentioned, it will allow the city to find itself again after years of safe but bland gentrification, billionaire towers, and just the soul of the city being crushed. The people who remain and have been there since the rough days of the 80s and early 90s will continue to live their lives in the outer boroughs.

When rents come down, what makes you think it won't be chains occupying those spaces again?

A very large proportion of independent retail operators are losing all their savings/capital right now. Like I said before, many of them may be driven to personal bankruptcy from the personal guarantees in their leases, unless the state or city government steps in somehow to void those guarantees. Where are the new independent operators going to come from, to suddenly replace the 50% of places that will close? That waitress is going to open her own restaurant? The chef? Where will they get the $1 million or so it takes to open a restaurant in NYC these days? Kickstarter? Celebrity chefs may be able to pull it off, but there aren't too many of them.

Rents will come down in Manhattan, but they aren't coming down to the level of a suburban strip mall. We're talking $50k a month rent will become $25k a month. It will still be expensive. And property tax bills are insane, adding a good $100k + a year to most of the typical triple net leases in Manhattan. Those taxes are definitely not coming down. Don't be surprised if big cities become even more full of chains than before.

[mrnyc]

tourists have returned to the west village and there is more and more life out and about. not to normal levels, but definitely rebounded from height of the pandemic. fwiw the homeless/bums around that maybe stood out around here a bit in the emptiness have faded back into the background. if anything stands out its that the outdoor dining and streeteries thing has gotten rather off the hook popular here near the end of summer. its fine in the day, but i avoid that crowded as usual, corona-fest scene at night. also, the highline is partly open, you have to make a reservation, but its a heck of a lot nicer experience now.

[McBane]

Originally Posted by iheartthed

The chains are for the tourists. If the tourists aren't here then the chains won't be either. As soon as the pandemic is over chains will want to be in Manhattan again.

What an asinine comment. Yes, the Bubba Gump Shrimp and TGI Fridays in Times Square are for the tourists. But what about the ubiquitous Duane Reads? Whole Foods, Foot Locker, Target, Marshalls, etc. Not everyone needs or can afford bespoke, unique items from the boutique shop and certainly not for toilet paper, Tylenol, or socks.

[Crawford]

Originally Posted by the urban politician

I'm going to throw in my prediction:

Fall 2021, on SSP:

Everybody will be talking about how vibrant and thriving our great center cities are again.

This will end up being a giant blip in the radar

I think this is probably true. Fall 2021 sounds a bit early for full, 100% recovery, but probably not far off.

Vaccine is a given, political shift is a near-given, the main question is how fast global economy recovers to enable business- and leisure-based consumption. I think tourism will take a couple of years for full recovery.

[Obadno]

Originally Posted by the urban politician

I'm going to throw in my prediction:

Fall 2021, on SSP:

Everybody will be talking about how vibrant and thriving our great center cities are again.

This will end up being a giant blip in the radar

Yeah the confirmation bias around Covid is actually hilarious.

This is far from the first time pandemics have emptied cities (and relatively this isnt even dangerous) Every time cities rebounded.

Policy Makers and reporters pontificating on masks forever and permanent changes to how we live our lives are being completely nieve.

Long term office demand will be less per company as the slow process of work from home and remote working has been accelerated but 2/3-75% of office workers will be back in the office in the coming months.

A big change that will absolutely crush commercial real estate for years but its not going to turn cities into ghost towns forever.

New York and other Cities will be hit harder, There are many companies in NYC that now realize they can have people doing financial jobs in Nashville, Phoenix, and Jacksonville just as effectively and much cheaper than having them in Manhattan. That is an industry change that WOULD HAVE happened anyway just much slower.

[UrbanImpact]

I feel like the whole country is in the same situation.

[Qubert]

Originally Posted by jd3189

As people have mentioned, it will allow the city to find itself again after years of safe but bland gentrification, billionaire towers, and just the soul of the city being crushed.

I always see this repeated ad nauseum and don't really know where it comes from. I guess the 7 million out of 8.5 million people who aren't sex and the city style yuppies were invisible all this time?

NYC hasn't been as vibrant during this "Soul Crushing" period since the 1920s. If record immigration, employment, entertainment and dining options are what comes with bland billionaire towers than sign me up.

[LA21st]

Originally Posted by Qubert

I always see this repeated ad nauseum and don't really know where it comes from. I guess the 7 million out of 8.5 million people who aren't sex and the city style yuppies were invisible all this time?

NYC hasn't been as vibrant during this "Soul Crushing" period since the 1920s. If record immigration, employment, entertainment and dining options are what comes with bland billionaire towers than sign me up.

Lol, I don't either. And there's plenty of regular/not sex in the city crowd in Manhattan too. They say the same thing for SF, but when I went there last Thanksgiving, I saw more "regular" people than the pretentious types you always hear about. Of course, this is true everywhere. Miami, LA, DC etc.

[SIGSEGV]

Originally Posted by the urban politician

I'm going to throw in my prediction:

Fall 2021, on SSP:

Everybody will be talking about how vibrant and thriving our great center cities are again.

This will end up being a giant blip in the radar

Yeah, but in the mean-time, seems like a good time for my wife and I to buy a place in the loop... lol.

[Steely Dan]

Originally Posted by SIGSEGV

Yeah, but in the mean-time, seems like a good time for my wife and I to buy a place in the loop... lol.

With interest rates being what they are, and a depressed covid/looting-influenced market, I think you'd be very wise to jump on that shit if you can make it happen.

I'm in the opposite situation, I've got a downtown rental property that my tenant of 8 years is leaving. I'd kinda like to just sell it (being jobless and all, cashing out is very tempting) but I don't think that'd be a smart move at the moment.

If anyone is looking for a VERY affordable studio in marina city for October 1st move-in..........

[SIGSEGV]

Originally Posted by Steely Dan

With interest rates being what they are, and a depressed covid/looting-influenced market, I think you'd be very wise to jump on that shit if you can make it happen.

I'm in the opposite situation, I've got a downtown rental property that my tenant of 8 years is leaving. I'd kinda like to just sell it (being jobless and all, cashing out is very tempting) but I don't think that'd be a smart move at the moment.

If anyone is looking for a VERY affordable studio in marina city for October 1st move-in..........

haha, yeah one issue is that our lease doesn't expire until next summer (18 month lease seemed like a good idea at the time, lol) and finding a subletter is probably going to be difficult without taking a steep hit (and our building is already offering free rent incentives to new renters since there are quite a few vacancies at the moment.) We can buy out our lease but, it's 5 months rent if we do it before February, 3 months after. Might still be worth it, but not fun.

[the urban politician]

Originally Posted by SIGSEGV

Yeah, but in the mean-time, seems like a good time for my wife and I to buy a place in the loop... lol.

Unfortunately, the for sale market is a much more lagging indicator of demand than the rental market.

My rentals responded rapidly to the downturn and are all struggling this year—I’ve had to slash rents and sit on some vacancies for longer than usual.

However, when you look for investment properties, sellers are still hanging onto their pre-Covid prices and haven’t budged.

I believe home sales are similar.

Bottom line: if you want a real bargain on buying a Loop condo, I don’t think Covid will really deliver unless the economic fallout is prolonged. If that is the case, look for a condo in 2022. That’s when you may see the best deals

[Hudson11]

It's not just crime. There are numerous signs of decline, some tangible others not. Breaks my heart, but I rest easy knowing the city isn't going to die as some foolishly claim.

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[iheartthed]

Originally Posted by McBane

What an asinine comment. Yes, the Bubba Gump Shrimp and TGI Fridays in Times Square are for the tourists. But what about the ubiquitous Duane Reads? Whole Foods, Foot Locker, Target, Marshalls, etc. Not everyone needs or can afford bespoke, unique items from the boutique shop and certainly not for toilet paper, Tylenol, or socks.

What about them? This is obviously not the context of the discussion. We weren't talking about Duane Reade, which is actually a local chain (yes, I know it's owned by Walgreens). And show me where Whole Foods, Foot Locker, Target, or Marshalls has discussed plans to ditch Manhattan.

[JManc]

I am just waiting for NYC to fall to shit and then I will move in and snap up a cheap little fixer-upper on the UES.

[Pedestrian]

Originally Posted by JManc

I am just waiting for NYC to fall to shit and then I will move in and snap up a cheap little fixer-upper on the UES.

Are you a Jet or a Shark?