Downtown Lags City in Rate of Business Creation
Lower Manhattan ranks near the lowest among all communities in the five boroughs of New York City for business creation over the past five years, according to a new report from State Comptroller Tom DiNapoli.
The analysis, titled “Business Growth in New York City During the Covid-19 Pandemic,” documents that Lower Manhattan (defined here as Community Districts 1 and 2, which means roughly the area south of a jagged line formed by West 14th Street, the Bowery, Canal Street, and the Brooklyn Bridge) was one of just seven areas of the City that fell into the bottom category of business growth, a tranche of between -3.0 and +4.8 percent, in the five-year period that ended in December, 2023. (For devotees of data, the zone corresponds to Public Use Microdata Area [PUMA] 3810, as designated by the U.S. Census—one of 55 such catchments throughout New York City.)
Within this band, Lower Manhattan fell on the high end, with growth of 3.1 percent, according to a spokesperson for the Comptroller’s office. Community Districts 1 and 2 had a combined total of 23,384 businesses in 2019, which had grown to 24,104 by the close of last year. During the same interval, the overall number of businesses throughout the City rose 6.5 percent, or slightly more than double the local tally.
Because almost all new businesses are small firms, Mr. DiNapoli’s report focuses on this sector. The share of companies employing five people or fewer shrank in Manhattan as a whole by 2.3 percent during the same five-year period, while some outer borough neighborhoods saw explosive growth. Among these were Bedford-Stuyvesant (35 percent), Bushwick (30 percent), and Crown Heights North (27 percent).
“Neighborhoods in Manhattan below 96th Street saw declines or comparatively slow growth over the period, as overall population, commuters and foot traffic in the borough declined,” the report notes.
This report comes on the heels of an April analysis by the City’s Department of Small Business Services, which showed that Lower Manhattan has a higher percentage of vacant storefronts than any other area of the five boroughs. SBS’s annual “Report on Storefront Businesses” for 2023 notes that there are 2,931 storefronts within CD1, of which 1,875 are occupied by operating businesses, and 516 are empty. This is considerably worse than the overall proportion for Manhattan (15 percent) and double the vacancy rate for the City as a whole (11 percent).
A third report, from a public policy think tank, the Center for an Urban Future (CUF), documents that corporately owned chain stores in Lower Manhattan declined from 349 in 2022 to 338 by the close of 2023. This local retrenchment of of 3.15 percent tracked almost exactly to the broader decline of 3.1 percent that the CUF analysis observed in the City as a whole.