Thu. May 19th, 2022

All the office workers in Midtown who sit at home in their pajamas do not go on shopping trips, power lunches or drinks after work — and it turns out.

Midtown Manhattan suffers worse than any other neighborhood in the city when it comes to vacant store windows, according to a new real estate industry report.

Nearly 30 percent of the store windows in New York’s premier business district are empty. A “devastating” shortage of office workers means there are not enough customers to keep retailers going, according to the Real Estate Board in New York.

These vacancies are located far above empty storefronts in several residential neighborhoods, where there is still a critical mass of people, retailers and restaurants counting on.

In Midtown, according to the REBNY report, only about 25 percent to 30 percent of the normal number of workers enter the office – meaning about 60,000 people on the street for lunch, haircuts, shopping or shoe shine. That compares to 180,000 office workers in the area before the pandemic closes.

Such a shortage of people has led to an increase in vacancies in the store – even on key corners and on ritzy Madison Avenue, according to the REBNY report. Some entire blocks are full of empty storefronts, which include both retailers and restaurants.

Diagram from REBNY showing tall tomatoes in storefronts
Statistics compiled by the Real Estate Board in New York as of this summer show tall tomatoes in storefronts in neighborhoods that depend on office workers. Residential neighborhoods have fared better.

Schnipper’s, a burger and sandwich, had three locations in Manhattan before the pandemic. It has only two left as its bread-and-butter luncheon volumes have been decimated.

The remaining Schnippers locations are both in Midtown – on Lexington Avenue and 51st Street and just off 41st Street and 8th Avenue. Co-owner Andrew Schipper said the stores will bring in between 40 and 50 percent of their sales by March 2020.

“We trust office workers and they just haven’t come back yet,” he said.

And it’s not just Midtown: the restaurateur was forced to close his third eatery at 120 Church St. in Lower Manhattan in April 2020, after his landlord refused to make concessions when the city went into lockdown, Schipper said. That space is still unoccupied. “It looks exactly like we left it 18 months ago.”

Schnipper said his Midtown landlords worked with him. Therefore, these sites are still open, he said, refusing to give details about the concessions.

Not all restaurants and retailers have been able to survive: The areas near the Grand Central Terminal and in the Midtown East neighborhood have 29.9 percent store facilities, according to the report. In 2018, storefronts around Grand Central were only 10.9 percent vacant; Midtown East reported a vacancy rate of 15.3 percent at the time.

A block of shops that are empty.
Midtown has a higher percentage of entire blocks that have vacant storefronts.
Bloomberg via Getty Images

These numbers jib with other statistics showing small businesses and retailers, including restaurants and bars, have been among the hardest hit in the Big Apple, as The Post has reported.

“REBNY’s findings confirm the crippling effect that the pandemic has had – and continues to have – on the retail sector in Midtown Manhattan,” said Fred Cerullo, President and CEO of Grand Central Partnership, in a statement. “For these businesses to thrive, they need the kind of foot traffic generated by tourists and office workers.”

Labor Day was due to begin returning to offices, but the Delta variant pushed many companies’ plans to bring employees back.

About two-thirds of companies delayed their return to office by as early as early 2022, according to a Gartner survey in August, while a recent report from The Partnership for New York showed that employers in the city had expected only 41 percent of office workers to have returned by September 30 – down from a previous estimate of 60 percent.

The retail sector in some of the suburbs has meanwhile fared much better than in Manhattan, the report said. Retail sales in Greenpoint and Prospect Heights in Brooklyn were 14.6 percent; it was 14 percent in Astoria and Sunnyside in Queens.

A Gap store that closed for good.
Many large chain retailers have contributed to the high unemployment rate in Manhattan.
Bloomberg via Getty Images

But retail corridors that rely on office commuters have lagged behind in residential neighborhoods. Subway ridership in September has risen to just 50 percent of pre-pandemic levels, the report notes. And Manhattan accounts for nearly half of the city’s jobs in the retail sector.

All of these companies are big business for New York: The retail sector in 2019 provided 344,600 jobs and contributed $ 55 billion in taxable sales to the city’s economy, according to the report.

To address the negative trends, REBNY, which represents the city’s largest real estate interests, recommended the city and state focus on aggressive vaccination policies and encourage employers to bring workers back to the office.

“New York City is still running,” the report said. “Restoring the city’s economy would not be complete without the retail sector.”

An empty corner store space.
The area around the Grand Central Terminal and Midtown East has among most corner locations in the retail trade.
Getty Images


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