Manhattan Stores Suffering from Work from Home

Hundreds of independently operated Manhattan storefronts are in jeopardy as a result of a major move towards working from home. They’ve been holding on for years, waiting for life to return to the deserted streets of Midtown and the Financial District. The fate of these stores, and by extension the country’s two most important business centres, will be determined in large part by how long landlords will continue to give the rent breaks that have kept many retailers afloat.

Landlords are facing increasing financial strains as office vacancies rise and commuters and tourists flee. Manhattan distinctive retail culture — jewellers, barber shops, function halls, and bars — is in jeopardy, as are the street-level canyons of the city’s skyscraper-filled office districts.

Gili Vaturi, who owns Torino Jewelers on Lexington Avenue, said, “Right now, we’re struggling.” Even with a much-reduced rent agreement with her landlord, GFP Real Estate, she said her revenues are still so low that she is not covering all of her expenses. GFP Real Estate owns hundreds of Manhattan properties and has a significant minority interest in the landmark Flatiron Building.

Luke Pardue, economist at Gusto, said, “Right now, small business jobs are disappearing from cities — and may never come back even after the vaccination is widespread and the economy fully reopens.” The Empire State Building’s owner announced on Wednesday that just 48.3 percent of the building’s retail spaces were leased, down from nearly 70 percent at the end of 2019.

According to Eric Gural, one of the company’s co-chief executives, GFP, Ms. Vaturi’s landlord, has allowed over half of its storefront tenants to pay approximately 10% of their sales in rent in order to survive.