Retail rents in Harlem are duplicating the path taken by home prices and rents in the area since the boom. According to the New York Daily News, that increasingly means national chains are replacing the Harlem’s beloved mom-and-pop businesses.
“…expected the asking rents to soon reach $175 per foot.”
The average retail rent in the second quarter this year was $100 per foot, up 33 percent from $75 the prior-year quarter, which itself was a 50 percent increase of retail rates in 2010. Prudential Douglas Elliman Retail Chairman Faith Hope Consolo said she expected the asking rents to soon reach $175 per foot.
There’s activity “happening on 125th St., Frederick Douglass Boulevard and Lenox Avenue as well as Sugar Hill and on 145th Street,” Consolo said. “The only place that is lagging is Spanish Harlem.” Red Lobster is moving in next door to the Apollo Theater and Whole Foods is reportedly on the look-out for a Harlem store.
Harlem business owners, stake holders and merchants respond:
- Harlem Lofts President Robert Pair, said “the shifting retail climate is a direct result of the government raising the limit on federally backed loans, making the neighborhood an attainable alternative for families seeking larger spaces.”
- Kurien Thomas, co-owner of Executive Fashions, said “some stores are moving to less-trafficked blocks to whether the spiraling rents. That wasn’t an option for Executive Fashions,” he said, “because the business would suffer without the high volume.”
- Regina Smith, the executive director of the Harlem Business Alliance, said that she’s “…seen more than a dozen area small businesses close up over the last year.” “It’s the rent,” she said, “noting that many Harlem businesses have seen their rent skyrocket — in some cases, doubling — forcing many long-time shops to close.”
- Leah Abraham, co-owner of Sette Pani, said “why new business do well is no secret, as one of the business who changed the commercial landscape of central Harlem, I can tell you I paid for all the rolls. We gave the newcomers the ‘Get out of Jail’ card but didn’t get the free parking or collect the $200 as we passed go. We came with big dreams of bringing a place everyone would be proud of having in their backyard, we provided the best service we could afford (…there were no tips we had to pay the wages, etc.,). I can honestly say that I brought a different kind of experience in Harlem that was accessible to everyone and word of mouth was the only PR I could afford.”
“Our generation of entrepreneurs listened to our hearts and not our heads.”
She continued “Today, the clientelle has changed but we spent our resources surviving and the new business are building…on that. There is no mystery about a good businesses the first and second year, the struggles come the 5th and 6th year and beyond. I am very sorry to see these businesses go as I know each one of them carried a huge load to just survive and helped build the infrastructure for the new.” She added “We came to Harlem because we fell in love with what we saw and wanted to build our flagship store here. The landscape of the Boulevard was full of potential with abandoned buildings that were brought back to life, history and people that we had the privilege of serving and befriending, so many I wish I had recorded those conversations. Our generation of entrepreneurs listened to our hearts and not our heads.”
- Marva Allen, the owner of Hue-Man Bookstore, said “soaring rents would continue to hurt small businesses and eliminate jobs.” “It’s taking the character out of Harlem,” she added. “These mega-businesses are sucking the lifeblood out of a place like this, and the money doesn’t stay in the community.”
- Barbara Askins, President of the 125th BID, mentioned specific points that has led Harlem to where it is today. She said “High rents: in 2008 when we completed a market retail study and a cultural destination study for 125th Street. At that time rents ranged from $50 to $175 per square foot. Shortly thereafter the economy slowed down and rents also came down. (We) have not done a comprehensive survey again, …getting … $125 with $145 as the highest. If this is true, they have not gone back to where they were before they came down. She continued “others might say is “…consumer demand, Last month, we had a pedestrian foot fall count over 800,000 on the southwest corner of 125th Street. I have been told by many cities outside New York that they would kill to have that kind of traffic in their downtown. One question: if the people are on the street, than which businesses are they patronizing and why? And why are they not patronizing others? During our study (at the 125th Street BID), we identified … that it would be very challenging for mediocre businesses to survive in the emerging climate….
“…It is imperative that businesses rise to the challenge of providing superior product, merchandise, and service offerings to draw people into their establishments.”
…It is imperative that businesses rise to the challenge of providing superior product, merchandise, and service offerings to draw people into their establishments.” She continued “competition/over saturation: many new restaurants and nightlife establishments are continuing to open and this is also creating more competition than in the past for existing small businesses. One day the hot spot is the WXYZ Bar (at Aloft Harlem), the next week it is something else, the next day it is something else…” She continued, “Challenges: offering opportunities for small independent retailers to flourish along 125th Street and yet allow redevelopment (along with increased Floor Area Ratio) to happen has been and continues to be a challenge for us and many of the other organizations working with businesses in Harlem. There is also the pressure of bringing in better goods and services and serving a more mature market.” She said “…(and) when you add in the national and global effect on the business environment…” we have to “rethink the business model to stay in and ahead of the game may not be a bad idea.”
These are some of the challenges for small businesses in Harlem as we transition from the 20th century to the digital 21st century. Harlem has always landed on its feet since it’s start in 1658 and will do so again.
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- Harlem’s Only Bowling Alley Closing This Week (harlemworldmag.com)
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