Restaurants Are Helping Retail Boom In The Outer Boroughs While It Falters Elsewhere
Banking on the public’s need to feed themselves while shopping, places to eat are now a major component of NYC’s retail plans.
It’s a well worn saying that the key to a man’s heart (and probably woman’s too) is through his stomach. It seems like major retailers in New York’s boroughs have been bearing that in mind as they plan to circumvent the retail apocalypse blighting much of the country. In Queens, Staten Island, Brooklyn and elsewhere a flurry of new retail construction is going hand in hand with new restaurants, the last bastion, Amazon, as yet, has not quite managed to get a foothold in.
“You can’t eat a sandwich on the Internet,” Jeffrey Roseman, executive vice president of Newmark Grubb Knight Frank’s retail division told the NY Post. “A lot [of stores] are tired and boring and unexciting. That’s the new challenge, and the ones that are doing it right will do business,” he said regarding the massive shut downs across the nation.
Where residential construction is booming, retail is hot on its heels and chain restaurants are part of the mix. Starbucks has a location in Long Island City. In Western Queens’ the first Chipotle is open at 26-16 Jackson Avenue.
“There’s nowhere to go but down,” said Steven Soutendijk, executive managing director of retail services at Cushman & Wakefield, told Crains of Manhattan’s retail challenges. “Rents got too high too fast.”
Soutendijk feels that the market is moving towards Amazon-proof businesses, like niche restaurants, Indeed, food and beverage businesses made up 41 percent of retail deals in 2016. Apparel, which faces a lot of online competition, accounted for 15 percent of transactions.
Certain areas of Manhattan such as Hudson Yards, the Financial District, The Meatpacking District and the forthcoming Essex Crossing mega project on the Lower East Side with a Target, new hotels and restaurants on the way, are, according to the Post reporting buoyant retail activity. Other areas, though, are languishing. As of April, Manhattan had lost 9,700 retail jobs since 2014, according to data from the quarterly wages and employment survey crunched by the Independent Budget Office and reported in Crains. Electronics and sporting goods stores have been particularly hard hit.
Many see the new projects in the boroughs with their restaurant heavy retail mix and hordes of new residents as the future of Tri-State retail. In Staten Island there are high hopes for Empire Outlets, a complex under construction by the ferry terminal which will have stores and places to eat, along with an artisanal food hall.
“It’s a new main street on the harbor,” says Faith Hope Consolo, chairman of retail for Douglas Elliman, who is representing the new project. “There will be a sense of place and entertainment — and you don’t have to go far,” she says, adding that the site is convenient by ferry from Manhattan and by car for those in Brooklyn, Long Island and New Jersey. A panoramic view of the city will be an added attraction via a 630-foot-tall Ferris wheel — along the lines of the London Eye.
In Long Island City, retail is playing catch up to the residential construction boom.
“Residents are currently waiting to buy a cup of coffee, and retailers want to lock in [lower] rents and not miss out like they did in Williamsburg [in Brooklyn],” Aaron Fishbein, director of Winick Realty Group, told the Post. Big box chain stores are waiting in the wings. Though rents are currently $65 to $75 per foot for mid-block locations, while corners can go for up to $75 to $100 per foot, should all existing leases be filled, don’t expect those numbers to last.
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