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March 19, 2009

Retail Hardest Hit in Brooklyn

Few stores have been able to avoid the painful effects of the current recession, but mom-and-pop stores, without the deep pockets of national chains, are particularly vulnerable to the downturn. And, it turns out, these locally-owned stores are getting particularly hard hit in Brooklyn. According to a study by Rep. Anthony Weiner's office, 14.1 percent of small stores in Brooklyn are now vacant, compared with 12.2 percent in Queens and 9.1 percent in the Bronx. “When the economy catches a cold, small businesses catch pneumonia,” said Mr. Weiner, in a press release. “Too many community shops—the backbone of the city’s economy, are hit hard by this downturn.”
Brooklyn Stores Hit Hardest by Retail Slump [Crain's]

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"Few stores have been able to avoid the painful effects of the current recession, but mom-and-pop stores, without the deep pockets of national chains, are particularly vulnerable to the downturn. And, it turns out, these locally-owned stores are getting particularly hard hit in Brooklyn."

Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Stop! Right there!

The reason for "Mom and Pop" stores going out of business and empty store fronts is because the Landlord have jacked up the rent!!! Mom and Pop lease expired and the Greedy and Delusional Landlords want double even triple the rent! One prime example was Eva Daniels. The rent for that space is wait.. 6000 a month (unconfirmed) and she walked. This is a growing trend and a very bad thing for Gentrification and the economy.....

The What (Yeah right)

Someday this war is gonna end...

Posted by: Return of The What at March 19, 2009 10:08 AM

did anyone read the vomitous article in AM new york today about flag ship stores for huge major retailers still wanting to open up in nyc? like the one store that opened up recently that sells like 40,000 dollar watches or something and had people in the window display gnawing on expensive stake as an in your face reminder that no matter what some people still have money to spend on overpriced junk. it was nauseating to read.

*rob*

Posted by: PitbullNYC at March 19, 2009 10:15 AM

what was the vacancy rate in the 70's and 80's? Im sure it was well over 14%.

I thought we wanted the old new york back?

Posted by: Santa at March 19, 2009 10:36 AM

I can imagine Brooklyn having higher vacancy rates than the other boroughs b/c of the higher rents
It's a shame, am noticing many stores in the south slope closing that opened up within the past 3 years!

Posted by: gemini10 at March 19, 2009 10:40 AM

Very true about landlords jacking up the rents once a street has become popular and successful because great places have opened up. It's one big reason so many wonderful businesses in Manhattan nad the various districts (flower, trim, bridal, etc) have disappeared. Its real shame.Small businesses, the mom and pops keep a nieghborhood and the economy healthy.

rob- if you would really like to get price-sick go to ABC Home. I was in there yesterday- very drool-worthy but the prices were totally insane.

Posted by: bxgrl at March 19, 2009 10:44 AM

i know it's terrible to say but things like this dont bother me all that much. dont frequent and probably never would 99.999 percent of stores in nyc anyway as they have nothing i need or want. i feel that's the case for a lot of people. there's only so many 2000 dollars fugly handbags made by a 20 year old FIT trustafarian, right? i know that's stereotyping the kinds of storefronts.. it does suck for people losing their jobs in retail though and to "some" it looks like a blight on the neighborhood. like i said in another thread tho, not to everyone.

*rob*

Posted by: PitbullNYC at March 19, 2009 10:52 AM

rob- most mom and pop stores are not selling 2000 bags. They are small food shops, hardware and sundries stores, laundromats and dry cleaners,basic clothing and shoe stores. Not boutiques. The point is, the impact of their loss on a neighborhood, even if you don't frequent the store, is felt by everyone. You shouldn't think that way- neighborhoods are made up of people who interact in numerous ways and all those ways make or break a community.

Posted by: bxgrl at March 19, 2009 10:59 AM

while I hate that shops are going out of business sometimes its the system cleaning itself of worthlessness. On the stretch of flatbush between atlantic terminal and GAP theres an unholy amount of nail salons, a hand full of hardware stores, and maybe 4 or 5 coffee shops. Sometimes there's just too much of one thing in a small area. oh I forgot maybe 5 sushi joints.

Posted by: Santa at March 19, 2009 11:16 AM

bxgirl, those arent the kinds of stores i see closing down much though. yeah people need those essentials, so it will be harder to pay higher rent, but they will still always exist somewhere in the same location. it's stupid fluff stores that are closing down these days for the most part.
maybe i see it differently cuz i only see it in soho and park slope.

*r*

Posted by: PitbullNYC at March 19, 2009 11:18 AM

Please - 99.9% of the storefronts in NYC (especially in the outerboros) - are not, and will NEVER be conducive to 'chain operators'. So IF Landlords are forcing the mom & pops to close with unrealistic rent expectations (I do not believe this is the main issue), then it is only a matter of a short time till the asking rents begin to fall precipitously - an empty store front in a 1-5 store building will immediately be felt and cause big problems in terms of either paying financing or re-financing.

Posted by: fsrg at March 19, 2009 11:25 AM

What,

I rarely agree with many of your posts, but the whole triple the rent thing is stupid. I did also hear that the space Eva Daniels was in will rent for $6,000. ??? Unlike yourself I am more open to the "gentrification process" (wow that sounds like a four letter word) but empty store fronts are not good for any class / sector of our fragile economy. I am scared that there will be more of this to come, and that saddens me.

Posted by: Under the Radar at March 19, 2009 11:31 AM

everyone essentially wants "gentrification" just to varying degrees. It might be something as small as someone wanting a grocery store on their block that has nice meat and produce to someone wanting stores that sell 1000 dollar dresses. No one wants to live in a ghetto with no grocery options and only shitty fast food joints.

a good example is sunset park around 8th ave. Every store front is open and jammed with shit. Sometimes way too much shit. There are more people walking around buying stuff than in the more expensive brownstone brooklyn areas and you can seriously buy anything you need. The area is safe and its still cheap to live in. Is this gentrification? If its not then what is it.

Posted by: Santa at March 19, 2009 11:55 AM

"I rarely agree with many of your posts, but the whole triple the rent thing is stupid. "

I rarely agree with many of your posts, but the whole Mutant Asset Bubble thing is stupid?

This is the psychology of the MAB. Greed and Delusion has a negative effect on people, especially those who has been influenced by it. Look at this statement again: "Unlike yourself I am more open to the "gentrification process"

Gentrification is dead. The whole foundation of the MAB was Gentrification and that has been replaced by fear: "wow that sounds like a four letter word) but empty store fronts are not good for any class / sector of our fragile economy."

There is another post about Gentrification and the comments from the Assheads are funny. Man this will not end well...

The What

Someday this war is gonna end...

Posted by: Return of The What at March 19, 2009 11:59 AM

In my area of CHN we would love more shops and stores along Nostrand- but improving a neighborhood is not the same thing as "gentrification." :

Gentrification, or urban gentrification, is the change in an urban area associated with the movement of more affluent individuals into a lower-class area.[2] The area experiences demographic shifts, including an increase in the median income, a reduction in household size, and often a decline in the proportion of racial minorities (if such minorities are present).[3] More households with higher incomes result in increased real estate values with higher associated rent, home prices, and property taxes. Industrial land use can decline with redevelopment bringing more commercial and residential use. Such changes often result in transformation of the neighborhood's character and culture.[4]WIKI

The family owned hardware store by me is owned and run by a local guy. And there are a number of places like this- and many more local people would open and run businesses if they had the money and support to do so. That's not gentrification, that's bootstrapping, to me. We need a lot more of that. And we need a lot more landlords to stop getting greedy and squeezing out the very businesses that improve the neighborhood. Places like Eva Daniels add value- shortsighted landlords don't get this important point when they raise the rents and drive them out.

Posted by: bxgrl at March 19, 2009 12:15 PM

It is never one or the other - businesses who have been there for this mythical "forever" OR gentrifying pirhanas ready to eat up every semblance of authenticity. There are plenty of small businesses that are started by local residents, who love Brooklyn and want to establish themselves within the character of the borough. But it is hard. Brooklyn is getting more, not less expensive, and space it at a premium in many neighborhoods. But these businesses provide jobs and character and possibility for insiders in as many cases as outsiders. Entrepreneurship should be taught in our schools as a viable and exciting path to wealth creation, and this has to be underscored by a support from city government for the fostering and protection of small businesses.

Posted by: kdonna at March 19, 2009 2:32 PM

"fear: 'wow that sounds like a four letter word'"

ROTFLMMFAO

***Bid half off peak comps***

Posted by: Brownstones Half Off at March 19, 2009 2:59 PM

I DO NOT AGREE WITH YOUR COMMENTS

Although rent plays a big role in whether a store will succeed or not, its not the only variable!

I am renting a store with a 15 year lease in park slope. The owner of the buisness has 1 year left on his lease. However, he is closing his business now because things have gotten really bad for him. Sales are not what they used to be. Even though he has 14 months left on his lease, he decided to close.

.........so he is paying the same rent I was charging him 14 years ago....and he is still closing down!!

Its definitly not the rent. Its the business model and the economy. At least in his case.

Posted by: landlord at March 19, 2009 3:18 PM

Landlord- yes- you're right. The economy and the business do have a lot to do with success or failure. But I have seen far too many businesses lose their leases or have them increased so much that they drive out the business. Rent is probably the biggest single expense expense a business has to cover each month- and depending on what it sells, a drastic increase in rent or any other necessary expense can tip a successful business into failure.

Posted by: bxgrl at March 19, 2009 3:47 PM

landlord,

Of course rent is only one of many expenses retail businesses must pay, but fools love to pin the blame on somebody, so they choose to blame the landlord for jacking the rent. Of course every business model is different, but for restaurants in particular, rent is only a fraction of expenses.

Most small landlords aren't jacking rents in this environment for proven long term tenants.

Like always, well run businesses that provide a needed service are staying in business and those that aren't are going out of business. Sure, in a down economy there's less spending overall, but well run businesses should be able to overcome short term slowdowns.

Posted by: IronBalls at March 20, 2009 8:28 AM

« CB14 Says No To Japanese Sect's Church Plans St. Augustine's Getting Unwrapped »

March 19, 2009

Retail Hardest Hit in Brooklyn

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