By Sarah Trefethen
Lower Manhattan isn’t just for Wall Street anymore.
With a growing residential population and an influx of office tenants in creative services and other industries, the post-9/11 downtown is setting a new standard for urban lifestyles.
“Thirty percent of the people who live in lower Manhattan walk to work. I don’t think we can overstate the value of that,” Elizabeth Berger, president of the non-profit Downtown Alliance, told attendees of NAIOP’s “Building the Future of New York City” forum last week. “It sounds like an old-fashioned value, but it’s very, very current.”
The combination of office workers, tourists, residents and all that foot traffic creates fertile ground for a wide range of business.
“Every retailer realizes they need a outpost south of Canal Street,” said David Cheikin, vice president of leasing for Brookfield Properties, also at the NAIOP event.
In recent years, the area that once went dark after five and on the weekends has become the home of a number of residentially oriented businesses, including a thriving Whole Foods market.
“A lot of the retailers down there have some very, very strong stores,” said Chase Welles, an executive vice president at Northwest Atlantic Real Estate Services who represents Whole Foods and Staples, which also has a downtown store.
Welles has noticed the change in the area, he said, and is currently seeking lower Manhattan locations for a number of other clients.
“The service retailers — butchers, bakers, candlestick makers — those people are down there, whereas they weren’t before. Before, it was Irish bars open for lunch,” Welles said. “The success of Whole Foods is an example of that.”
In 2011, retail rents along the downtown Broadway corridor averaged $184 per square foot, according to Downtown Alliance. That’s a 22 percent increase over asking rents in the fall of 2010.
Lower Manhattan’s residential population has nearly doubled since 2003, according to the Downtown Alliance, and annual household income is $188,000.Office space is growing right along with the number of residents.
The publisher Conde Nast’s decision to relocate its offices to over one million square feet in the World Trade Center was a “game changer” for lower Manhattan, Berger said, but she noted that there are more than 50 other creative firms baseddowntown, alongside the area’s traditional financial services.
More and more young professionals are choosing to live downtown or in Brooklyn and coastal New Jersey, all areas easily accessible by lower Manhattan’s conflux of trains, buses and ferries.
“Lower Manhattan no longer has to apologize for its distance from Fairfield or Westchester County,” said John Wheeler, managing director of Jones Lang LaSalle.
Lower Manhattan hosts 85.2 million s/f of office space, with another 4.5 million under construction, including the World Trade Center complex.When completed, the WTC will also bring another 550,000 s/f of retail space to the area, including two-levels of a below-grade concourse extending from the World Financial Center to both the new Fulton Street Transit Center and the corner of Liberty and Church Streets.
And Brookfield, which owns the World Financial Center, is planning another 200,000 s/f of retail, including a new dining terrace and additional space for luxury retailers in the financial center courtyard.
The WTC — along with the Brooklyn Bridge and the Statue of Liberty — also draws visitors to lower Manhattan. The neighborhood attracts 9.8 million visitors each year, and five new hotels are expected to open downtown over the next three years, adding over 1,000 guest rooms. In the closing keynote for NAIOP’s forum, World Trade Center president Janno Lieber hailed lower Manhattan’s emerging live / work community.
“You have one of the best public schools in New York, and you see school buses lined up two blocks from here in front of new condos and Bed Bath and Beyond,” he said.“It’s the one place where you’re really seeing that walk-to-work sustainable development model. Compact, dense, fewer trips, smaller carbon footprint.”
