In the heart of Manhattan’s Fashion District, a once-busy Starbucks on the corner of Eighth Avenue and 39th Street is empty. Just down the block, a Taqueria Dos Toros that opened just three years ago is now closed. And Wok to Walk, which once served steaming containers of noodles mixed with chicken and veg to a lively lunch crowd, is also closed.
As the Delta variant of the coronavirus has again delayed plans by many companies to bring workers back to the office en masse, workers who have flocked to Midtown are finding many of their go-to spots for a quick cup of coffee and a muffin in the morning or sandwich or salad at lunch time are gone. A number of those that are open operate at reduced hours or with limited menus.
As the pandemic has kept millions of New York City office workers at home over the past year, restaurants, cafes, clothing retailers and others have struggled to stay at home. flow.
By the end of 2020, the number of chain stores in Manhattan – ranging from drugstores to clothing retailers to restaurants – had fallen by more than 17% from 2019, according to the Center for an Urban Future, a non-profit research and policy organization.
Across Manhattan, the number of stores available on the ground floor, normally the area of ââbusy restaurants and clothing stores, has skyrocketed. A quarter of Lower Manhattan’s ground floor storefronts are available for rent, while about a third are available in Herald Square, according to a report by real estate firm Cushman & Wakefield.
Starbucks has permanently closed 44 outlets in Manhattan since March of last year. Pret a Manger has only reopened half of the 60 locations it had in New York City before the pandemic. Many delicatessens, independent restaurants and small local chains have died out.
âMidtown has clearly been the hardest hit of any Manhattan neighborhood,â said Jeffrey Roseman, a senior retail real estate broker at Newmark. âIf you think of other office-centric areas, whether it’s downtown, Flatiron, or Hudson Yards, there are a lot of residential neighborhoods around those areas that have helped support these markets. Midtown, for the most part, is a one-ride pony.
“These are mainly offices and hotels, which have also been affected by the slowdown in tourism.”
The turmoil, however, reached the city center further on. Last week, luxury furniture retailer ABC Carpet & Home – whose flagship store was a staple in the Union Square neighborhood – filed for bankruptcy, in part because of “a massive exodus of current and potential customers leaving the city”.
But in a city where one person’s downturn is someone else’s opportunity, some restaurant chains are taking advantage of record store rents to locate or expand their presence in New York City.
In the second quarter, food and beverage companies signed 23 new leases in Manhattan, major clothing retailers, which signed 10 new leases, according to commercial real estate services company CBRE.
Shake the hut and Popeyes Louisiana Kitchen is among those who signed new rental contracts this year. The same goes for burger chain Sonic, which signed a lease for its first Manhattan outpost, replacing a Pax Wholesome Foods store in Midtown. Philippines-based chicken joint Jollibee, which enjoys an engaged audience, plans to open a large flagship restaurant in Times Square.
Yet with so much uncertainty as to when employees will be able to fully return to the Midtown offices, some companies are proceeding with caution. Bluestone Lane Cafe intended to aggressively expand into Manhattan before the pandemic and is still considering locations in Midtown. But he’s now focused on opening up in more residential neighborhoods like Battery Park City, Hudson Yards and Tribeca.
âWe have intentionally selected urban residential areas for our new cafes so that we are not dependent on our locals returning to a physical office space and are well positioned for the future of hybrid work,â Nick Stone, Founder and Managing Director of Bluestone Lane. , said in an emailed statement.
And some restaurant chains that have already reopened in Midtown are changing their strategies to meet what they believe are the changing needs of customers in a post-Covid world.
On a recent weekday, a handful of patrons munched on salads and sandwiches at Bread Quotidien’s Bryant Park location. The long communal tables that once dominated the restaurant’s front are now gone, while refrigerated cases for a selection of take-out drinks, salads and sandwiches will be expanded next year as part of a remodel. A new app for pre-ordering and collecting food became available in May.
While new technologies work for some customers, others yearn for the past.
âWe’ve used QR codes to get customers to view the menu as we try to limit contact with surfaces, but the majority of our customers want to have a real menu,â said Stephen Smittle, senior vice president of operations for Le Pain Quotidien. . âThey really want to feel normal. They want a server. They want to hold a cup of coffee, not a paper cup.
In difficulty before the pandemic, Le Pain Quotidien filed a case bankruptcy in May 2020. It was acquired by Aurify Brands, which has since reopened numerous Le Pain Quotidien stores in the city, including several in Midtown.
âOur thought is that Midtown New York will return to a level that might not be 100% pre-pandemic, but based on the information we have gathered, I think Midtown will return to an important level,â Mr. Smittle said. . .
For Starbucks, one of the big lessons from the pandemic was that customers liked to order their drinks online and then pick them up quickly at stores or drive-ins. Starbucks had started offering this even before the pandemic, opening a pick-up location at the Pennsylvania Plaza in Midtown at the end of 2019.
Since early 2020, Starbucks has permanently closed 44 of its 235 branches in Manhattan. But it’s in the process of adding mobile pickup areas in many stores and adding more pickup-only locations. The company says it expects net growth from new stores in Manhattan over the next several years.
Prior to the pandemic, Starbucks operated three stores in the Columbus Circle area. He closed them and this year opened a big restaurant. Now, Central Park runners collect their pre-ordered drinks at a mobile counter and leave, while other customers line up to place their orders and can sit at nearby tables.
âWe were going to develop the concept and evolve over time,â said John Culver, president of North America and COO of Starbucks. âWhat we have done is seize the opportunity presented by the pandemic and accelerate the transformation of our store portfolio. Consumer behaviors during the pandemic have accelerated to levels no one expected. “