Broken Chains and Remote Work Raise Worries about Who’s Minding the Store in Lower Manhattan
Lower Manhattan is experiencing a case of emporia dysphoria according to multiple new analyses of the local business landscape. A new report from the Center for an Urban Future (CUF), a public policy think tank, documents that the presence of chain stores in Lower Manhattan has decreased markedly during the past 12 months. The CUF report, “State of the Chains, 2024,” indicates that there are currently 340 chain stores in Lower Manhattan, 15 fewer than a year ago. (CUF defines chain stores as businesses that have “at least two locations in New York City and at least one location outside the city limits.”) This local decline of 4.4 percent is more than triple the broader retrenchment of 1.3 percent that the CUF analysis observed in the city as a whole. It also represents an acceleration of retail’s retreat from Lower Manhattan in 2023, when the area lost 11 chain stores. On CUF’s list of the ten neighborhoods through the five boroughs with the fewest national chains, zip codes in Lower Manhattan occupy five spots.
A second analysis from the City’s Department of Small Business Services (SBS), the agency that publishes the annual “Report on Storefront Businesses,” offers data on individual neighborhoods. According to the SBS report for 2024, Community Board 1 (CB1) has the highest retail vacancy rate of any district in the five boroughs. Of the 2,305 storefronts located within CB1, 556 locations are currently unoccupied.
SBS says that the average storefront within CB1 employs 10.77 staff and pays $44,917 in annual sales taxes. These metrics suggest that vacant retail spaces in Lower Manhattan represent more than 6,000 lost jobs and $25,423,022 in annual tax revenue forgone.
A third report, “Storefront Activity in NYC Neighborhoods,” from the Department of City Planning (DCP), paints a similar picture. This analysis divides Lower Manhattan into a pair of demographic slivers known as “Neighborhood Tabulation Areas” (NTAs). The first of these, Battery Park City and the Financial District, currently hosts 1,098 storefronts by DCP’s count, of which 892 are occupied and 266 (or 24 percent) are vacant. In the second NTA, Tribeca and the Civic Center, there are 1,137 storefronts, among which 897 are rented out and 240 (or 21 percent) are empty.
The DCP report also tracks a more alarming indicator, which it labels “chronic vacancy” (defined as a store that has been continually empty since the first quarter of 2020, or five full years). In this category, there are 118 storefronts in the Financial District-Battery Park City NTA, and 85 shops in the Tribeca-Civic Center NTA.
“Vacancy varies considerably from street to street within neighborhoods,” the DCP notes. “In the Financial District, vacant storefronts are clustered along select corridors, such as Nassau [photo at right], Fulton, and Water streets. Other corridors and areas have far fewer vacancies, such as Broadway and Battery Park City.”
“If turnover is high but vacancy remains relatively constant or increases, as is the case in the Financial District,” the DCP observes, “that may be a sign of market pressure or other conditions that prevent storefront businesses from establishing a lasting presence in the neighborhood.”
“Areas like Downtown,” the report adds, “which relied heavily on an influx of daytime workers, have seen the largest increases in vacancy since before the pandemic… While employment has increased since then, and there may be more residents working remotely, there are fewer office workers in Lower Manhattan today, which affects storefront businesses through reduced spending and foot traffic.”
But “Storefront Activity in NYC Neighborhoods” also notes a local case in point as a possible remedy to retail woes, citing “the Privately Owned Public Space (POPS) at 85 Broad Street in Lower Manhattan, where the vacancy of surrounding storefronts is 3.9 percent compared to 24.3 percent across the neighborhood.
A spokesman for the Downtown Alliance, which operates the business improvement district that covers much of Lower Manhattan, says their data show that the community has seen 444 retail openings to 473 retail closings since 2020, for a net loss of 29 shops over the last five years.