RETAIL VACANCY CRISIS?

New York City’s empty storefronts have doubled in the last ten years. Is the demise of the mom and pop shops a full-blown crisis or a sign of the times?

To read City Comptroller Scott Stringer’s full report, click here. 

Aired on December 5, 2019. 

TRANSCRIPT

> GOOD EVENING, AND WELCOME TO 'METROFOCUS.'

I'M JENNA FLANAGAN.

EMPTY STORE FRONTS ARE BECOMING A COMMON PART OF THE NEW YORK LANDSCAPE.

BETWEEN 2007 AND 2017, THE NUMBER OF RETAIL VACANCIES HAS RISEN BY NEARLY 50%. THE CITY CONTROLLERS OFFICE IS NOW REFERRING TO THIS AS THE AMAZON EFFECT OR MORE SIMPLY PUT THE DEMISE OF RETAIL STORES AND THE FLOURISHING OF SERVICE-ORIENTED BUSINESSES LIKE RESTAURANTS, BARBERS, AND BOUTIQUE GYMS.

RETAIL VACANCY IS CHANGING THE FACE OF NEW YORK, BUT IS IT FOR THE BETTER.

CONTROLLER SCOTT STRINGER IS HERE WITH HIS REPORT SHOWING THE FULL SCALE OF THIS PRESSING SITUATION.

WELCOME BACK TO THE PROGRAM.

NICE TO BE WITH YOU AS ALWAYS.

OH, THANK YOU.

YEAH, SO TALK TO ME ABOUT THIS PROBLEM BECAUSE WE ALL SEE THE INCREASED NUMBER OF VACANCIES AND THIS USED TO BE A CITY THAT WAS FULL OF MOM AND POPS AND SMALL BUSINESSES AND THAT'S NOT THE CASE ANYMORE.

THAT'S FOR SURE.

LOOK, I GREW UP IN WASHINGTON HEIGHTS, AND I CAN TELL YOU AS A KID I KNEW A LOT OF THE LOCAL STORE OWNERS BY NAME.

THEY KNEW ME.

FAMILIES KNEW LOCAL STORE OWNER, AND THAT WAS SORT OF A WAY OF LIFE WALKING DOWN DIKEMAN STREET AND OTHER PARTS OF THE NEIGHBORHOOD.

TODAY YOU GO INTO YOUR LOCAL STORES AND IT'S NOT ABOUT MOM AND POP.

IT'S ABOUT WALKING INTO THE SAME DWAYNE REED OR CHASE BANK.

THE ONLY OUTLETS THAT CAN ACTUALLY AFFORD TO BE HERE.

SO, I DID THIS REPORT BECAUSE I REALLY WANTED TO FULLY UNDERSTAND THE VACANCY CRISIS THAT WE HAVE.

AND YES, WE SHOW CASE VACANCIES IN LOWER MANHATTAN, UPPER WEST SIDE, SOHO, TRIBECA.

WE SEE THOSE EMPTY STORES.

THE UPPER EAST SIDE HAS SO MANY BLOCKS WHERE THE STORE SPACE DOESN'T EXIST.

BUT WE ALSO NOUND THE CRISIS BEYOND MANHATTAN IN STATEN ISLAND AND QUEENS.

THIS IS A CITY-WIDE CRISIS.

PART OF WHAT WE NOW KNOW IS VACANCY HAS GROWN FROM 5.7 MILLION SQUARE FEET TO CLOSE TO 12 MILLION SQUARE FEET IN JUST THE LAST TEN YEARS OR FROM 2007 TO 2017, THIS IS THE DATA WE LOOKED AT.

SO, THIS IS A CRISIS.

YOU KNOW, PEOPLE FORGET THAT ONE OF THE REASONS WHY WE WANT VIBRANT STORES OPEN IS BECAUSE IT'S ACTUALLY A SAFETY ISSUE.

IT'S NOT JUST ECONOMIC.

IT GIVES THE STREETS THE VITALITY AND EXCITEMENT SO THAT YOU CAN WALK DOWN THE STREET LATER IN THE EVENING OR EARLY IN THE MORNING AND FEEL LIKE YOU'RE ALIVE IN THE CENTER OF THE WORLD, NEW YORK CITY.

WELL, SO A FEW THINGS.

ONE, LET'S GET INTO THE AMAZON EFFECT FIRST BECAUSE THAT IS ONE OF THE THINGS THAT YOU DO BLAME SO MANY VACANCIES ON.

AND IS IT JUST AMAZON?

IS IT AMAZON AND A MIX OF RISING RENT PRICES?

COUPLE OF THINGS.

THERE WAS LAND LORD RETAIL GREED.

WE SAW RENTS SORE 22% IN THE LAST TEN YEARS.

THAT WAS IN SOME CASE ORIS A LOT OF CASES I'M GOING TO GET WHAT I GET REGARDLESS OF THE IMPACT OF COMMUNITIES.

BUT TODAY IT'S EVEN MORE CHALLENGING.

THERE'S ANOTHER STORY TO BE TOLD, AND THAT IS THE AMAZON EFFECT.

PEOPLE ARE ORDERING ONLINE.

THEY'RE NOT GOING INTO RETAIL SHOPS.

THEY'RE ACTUALLY JUST LOOKING AND TAKING A CLICK AND THEN GETTING THE DELIVERY.

SO, THERE'S IMPACT ON THAT.

STORES ARE CONSTRICTING.

DELIVERIES ARE CLOGGING OUR STREETS.

THERE IS AN ONLINE SHOPPING CHALLENGE TO OUR CITY.

SO, I LOOKED AT THE AMAZON EFFECT.

WE ALSO LOOKED AT WHAT DOES THAT MEAN.

SO, WE'RE GOING TO SEE, I BELIEVE, LESS CLOTHING STORES AND, YOU KNOW, STORES THAT COULD ACTUALLY HAVE AN ONLINE PRESENCE.

AND WHAT'S REPLACING THOSE STORES ARE CAFES AND RESTAURANTS, MORE SERVICE-ORIENTED BUSINESSES, YOU KNOW, CHILD CARE OR DOGGY DAYCARE.

THERE'S A LOT OF NEW BUSINESSES.

BUT THE CITY IS NOT ALIGNING THE BUREAUCRACY TO MEET THAT CHALLENGE.

AND SO THE SMALL BUSINESS ADMINISTRATION, WE HAVE TO MAKE SURE THAT THOSE NEW BUSINESSES THAT WILL PERHAPS REPLACE OTHER BUSINES BUSINESSES, THAT WE GIVE THEM THE INFRASTRUCTURE THEY NEED TO BE SUCCESSFUL.

OKAY.

BECAUSE THAT WOULD BE ONE OF THE THINGS PEOPLE MIGHT PUSH BACK AND SAY RESTAURANTS AND CAFES DO KIND OF ADD -- IT'S A DIFFERENT KIND OF VIBRANCY THAN RETAIL STORES BUT A DO ADD THAT.

YOU HAVE PEOPLE SITTING ON THE STREETS.

IT'S EXCITING TO SEE THAT.

BUT THE PERMIT PROCESS, FINES AND FEES ON SMALL BUSINESSES, ESPECIALLY RESTAURANTS, HAVE JUST MADE IT IMPOSSIBLE TO KEEP THOSE BUSINESSES FLOURISHING.

AND YES, ONE BUSINESS GOES OUT.

ANOTHER RESTAURANT WILL OPEN.

BUT REALLY NOT WHAT WE SHOULD BE DOING.

WE HAVE TO HELP OUR SMALL BUSINESSES.

IT'S THE LIFE BLOOD OF THE CITY.

WE ASK OUR SMALL BUSINESSES TO DO MORE.

I SUPPORT A $15 MINIMUM WAGE.

THAT'S IMPORTANT.

WE WANT TO GIVE WORKERS MORE SO THEY CAN TAKE CARE OF THEIR FAMILIES.

THERE HAS TO BE WAYS THAT AS WE ASK BUSINESSES TO STAND UP ECONOMICALLY, WE HAVE TO ASK THEM TO SURVIVE AS WELL.

SO, THE FINES, THE FEES, THE BUREAUCRACY IS THE STRAW THAT SNAPS THE BUSINESS.

WE SHOULD START LOOKING AT A COMPREHENSIVE APPROACH.

AND ALSO DOING AN ANALYSIS OF DOING WHERE IS THE NEXT COMMERCIAL BUSINESSES IN OUR CITY.

THE OTHER THING I WOULD SAY IS THAT AS AN ADVOCATE AND ACTIVIST WHEN YOU SEE A BIG SCALE ENVIRONMENT, THIS DEVELOPMENT IS SO BIG IT'S T OUT OF CONTEXT WITH THE NEIGHBORHOOD.

SO, WE HAVE TO LOOK AT THAT.

AND THEN WE HAVE TO LOOK AT, WAIT, WE WANT AFFORDABLE HOUSING IN OUR COMMUNITY.

SO, THAT'S THE SECOND THING WE ADVOCATE.

THERE ISN'T ENOUGH DISCUSSION OF THE COMMERCIAL SPACE.

BECAUSE YOU'RE FIGHTING LIGHT AIR AND DENSITY AND AFFORDABILITY FROM THE HOUSING PERSPECTIVE, WE'VE GOT TO COME IN AND SAY WHAT'S GOING TO BE IN THAT GROUND FLOOR SPACE?

AND WE HAVE TO HOLD DEVELOPERS AND CITY PLANNING COMMISSION TO A REAL PLAN.

WE CAN'T HAVE JUST A BANK OR A BIG DRUGSTORE ON EVERY BLOCK.

THAT WAS GOING TO BE MY FINAL QUESTION.

IS THIS GOING TO BE GEARED MORE TOWARDS INDEPENDENTLY OWNED MOM AND POPS, IF YOU WILL, VERSUS CORPORATE STORES THAT CAN COME IN AND OPEN AND CLOSE VERY EASILY WITH VERY LITTLE PROBLEM.

WE MUST SUPPORT OUR SMALL BUSINESSES, OUR MOM AND POP.

A LOT OF PEOPLE WHO COME HERE FROM ALL OVER THE WORLD, A LOT OF WHY THEIR FAMILY GROWS ECONOMICALLY INTO THE MIDDLE CLASS IS BECAUSE ENTREPRENEURS, PEOPLE OF ALL DIFFERENT BACKGROUNDS, COME HERE AND SET UP SHOP.

THEY SAVE MONEY.

THEY TAKE THEIR ENTREPRENEURSHIP SERIOUSLY AND A COMMUNITY CREATES WEALTH.

WE CAN'T LOSE THAT IN A CITY.

WE GET FORGET THE PEOPLE WHO HAVE MADE THIS MAGICAL CITY, THIS INTEGRATED CITY FROM SO MANY BACKGROUNDS THAT COME HERE AND BECOME THE DESTINATION FOR SOME 65 MILLION TOURISTS.

THEY JUST DON'T WANT TO SEE THE STATUE OF LIBERTY OR THE EMPIRE STATE BUILDING.

THEY LOVE COMING HERE SEEING OUR DIVERSITY, HOW WE WALK, HOW WE TALK, WHAT WE LOOK LIKE, WHETHER IT'S GOING TO CHURCH ON SUNDAY OR WALKING JACKSON HEIGHTS.

THIS IS THE POWER OF NEW YORK CITY.

AND IT STARTS NOT WITH CHASE BANK BUT WITH THE MOM AND POP.

AND MAYBE THAT'S ALWAYS BEEN THE TIME TO THE VACANCIES ON COLUMBUS AVENUE.

YOUR PASSION FOR THE CITY, WHILE I BELIEVE IT, IT SOUNDS A LITTLE BIT LIKE SOMEBODY THAT MIGHT BE INTERESTED IN ANOTHER OFFICE.

IS THERE ANYTHING YOU WOULD WANT TO ANNOUNCE WITH US?

I WOULD ONLY ANNOUNCE IT WITH YOU AT THAT CERTAIN TIME.

OKAY.

I'LL TELL YOU THE REASON I LOVE NEW YORK.

YOU KNOW, I WAS BORN AND RAISED HERE AT A TIME WHEN THE CITY WAS UNDER SOME REAL CHALLENGES, ON THE EDGE OF BANKRUPTCY, BRONX REALLY WAS BURNING.

THERE WERE REAL CHALLENGES.

BUT FOR SOME REASON THE CITY JUST HELD TOGETHER.

AND NOW I HAVE REAL SKIN IN THE GAME.

I HAVE A 7 1/2-YEAR-OLD, A 6-YEAR-OLD, MAX AND MILES, THEY GO TO OUR PUBLIC SCHOOLS.

AND A LOT OF MY WORK IS THINKING ABOUT WHAT IS THE CITY GOING TO BE FOR THEM AND ALL OF OUR CHILDREN?

AND THAT IS SOMETHING THAT GETS YOU UP IN THE MORNING AND KEEPS YOU WORKING THROUGHOUT THE DAY.

SO, TO ME, THAT'S THE MOTIVATION.

AND I'M FORTUNATE BECAUSE I HAVE ONE OF THE OFFICES IN THE CITY THAT CAN HAVE AN IMPACT.

AND TO THE EXTENT I'M IN GOVERNMENT BEYOND CONTROL, IT'S BECAUSE I WANT TO HAVE THAT UNIQUE OPPORTUNITY TO HELP THIS GENERATION.

ALL RIGHT.

WELL, NOT AN OFFICIAL STUMP SPEECH BUT STILL VERY GOOD.

YOU'RE TOUGH.

THANK YOU SO MUCH FOR JOINING US.

THANK YOU, THANK YOU.

Funders

MetroFocus is made possible by James and Merryl Tisch, Sue and Edgar Wachenheim III, the Sylvia A. and Simon B. Poyta Programming Endowment to Fight Anti-Semitism, Bernard and Irene Schwartz, Rosalind P. Walter, Barbara Hope Zuckerberg, Jody and John Arnhold, the Cheryl and Philip Milstein Family, Janet Prindle Seidler, Judy and Josh Weston and the Dr. Robert C. and Tina Sohn Foundation.

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