In one of the U.S.’s marquee retail centers, the trendy Kate Spade fashion stores are boarded up for good. Victoria’s Secret and Gap have reopened stores in other states but not here. Subway and Le Pain Quotidien have walked away from dozens of sites.
Chipotle and Shake Shack report stores in the northeastern U.S., including Manhattan, are underperforming the rest of the regions in which the chains operate, according to Nick Setyan, an analyst with Wedbush Securities.
Gap’s Rockefeller Center store is still dark and has stopped paying its $264,000 monthly rent. A T.G.I. Friday’s near Rockefeller Center and another in Times Square have not yet reopened, although the chains are open elsewhere around the U.S.
“There’s no reason to do business in New York,” said Michael Weinstein, CEO of Ark Restaurants, which owns 19 eateries.
“I can do the same volume in Florida in the same square feet as I would have in New York, with my expenses being much less,” he added. “The idea was that branding and locations were important, but the expense of being in this city has overtaken the marketing [commandment] that says you have to be there.”
He has vowed never to open another restaurant in Manhattan.
Many retail chain stores were supported by the steady flood of tourists and foreign visitors through the City. Now that those shoppers have disappeared, along with the tide of daily commuters to the City’s office towers, the sky-high rents, real estate taxes, and other fixed costs attached are “unsustainable,” one retail chain executive said.
TREND FORECAST: As we have forecast in detail, New York City is on the first wave of the “Greatest Depression” decline. It will not “bounce back” for many years.
As for Governor Cuomo’s prediction in June, “You want to talk about a turnaround – this one, my friends, is going to go in the history books,” while he was dead wrong, it has been ignored by the media.
