The Flatiron District is proving to be a safe haven from the city’s retail slowdown.
According to a report from the Flatiron Partnership, the retail availability for the neighborhood in September stood at 5.6 percent.
The resistance of the neighborhood is mainly due to locally-owned businesses. According to the study, out of the 570 ground floor businesses operating in the area, 63.9 percent are owned by local companies such as Rizzoli Bookstore, Flatiron Green Cafe and Abracadabra. “As this report clearly demonstrates, Flatiron is a dynamic neighborhood with an irresistible mix of commercial and residential sectors,” said Jennifer Brown, the executive of the Flatiron/23rd Street Partnership.
“Despite the challenging environment for brick-and-mortar retail across the country and New York City, we are excited to report that the retail landscape in the Flatiron District continues to thrive, and a wide variety of innovative retailers are continuing to set up shop in the neighborhood.”
The Flatiron’s retail availability is lower than that of nearby areas. For instance, SoHo, which has taken the brunt of the retail slump with empty storefronts dotting the stretch of Broadway between Canal Street and Houston Street, posted a retail availability rate of 8.3 percent. Meanwhile, other retail hubs such as Chelsea (7.5 percent), Midtown South (seven percent) and Midtown (6.3 percent) also posted higher rates.
The drop in the Flatiron’s retail availability coincided with a rise in rents. Average asking rents for spaces in the neighborhood’s Fifth Avenue corridor rose to $456 per square foot. The figure represents an 18 percent jump from the spring of 2016. It is also the largest increase for any retail corridor in Manhattan. During the period, only two retail corridors in the borough posted an increase.
The health of Flatiron retail is also due to the growing number of restaurants and fitness centers operating in the area. The neighborhood, which has embraced the title of being the city’s “Fitness District, is now home to 47 gyms and studios, with the newest recruit being Alo Yoga. The number of fitness centers in the area has grown by a 15.8 percent jump from 2014. This means that fitness and wellness tenants now account for 10.3 percent of all ground floor businesses in the area.
Flatiron is now also home to 230 restaurants and bars, with 28 establishments opening in the district this year. The segment now accounts for 42.2 percent of all ground floor businesses in the neighborhood.
The area’s pool of shoppers is expected to rise modestly over the next few years. According to the report, the neighborhood’s population is expected to grow by 1.93 percent to 257,535 by 2022. These new residents will relocate to residential projects such as 39 West 23rd Street and 122-130 East 23rd Street.