Since the 1990s, Manhattan’s property prices have been rising, squeezing out many small businesses.
Then the COVID War was launched last March and the City that never sleeps was put to bed by the governor and mayor of the state.
From 1 March to 1 September 2020, 7,100 businesses in the city closed permanently, review website Yelp reported.
Now a rash of empty storefronts has pushed rates down to their lowest in recent memory. And young people who couldn’t afford the sky-high rents are starting to fill the empty spaces that landlords are pleased to get something from rather than nothing.
New York State saw more new businesses open last year than at any time since 2007 during the Great Recession, according to data compiled by the Federal Reserve Bank of St. Louis.
More than twice as many New York City business leases were signed in February this year as during the low point of 2020’s economic crunch, data firm CoStar reported.
Manhattan had become “richer and richer and less and less interesting,” Fred Wilson, co-founder of the Union Square Ventures investment firm, told the Wall Street Journal. “Lower rents, if they are sustained, will be terrific for street-level retail and restaurants.”
With employers requiring fewer workers to come downtown, pressures to keep rents low are likely to continue, encouraging new businesses to start and existing ones to trade up to better space.
During the economic crisis, residential rents also dropped in Manhattan by an average of 12 percent, Moody’s Analytics found.
Apartment rents had soared 230 percent since 1990 to $4,751 in 2019, about triple the national average, according to Moody’s, while the median U.S. household income grew only 114 percent.
TREND FORECAST: As we note in our new article, “AMERICANS STILL FLEEING URBAN CENTERS,” there will be new generations of young city dwellers moving into urban areas as rents decline and it is more affordable to open businesses and rent apartments.
Moreover, it will also spark an entirely new art, style, fashion, and food movements as young millennials and Generation Z create their vision of the present that has been left vacant by the current exodus of former city dwellers to suburban and ex-urban areas.
