National Retailers: NYC Worst Place To Do Business After COVID-19
The Big Apple is a rotten place to do business, according to retailers who say New York City is not bouncing back the way experts hoped.
Shake Shack reported just how bad the New York City retail climate is, and how much it can drag down a nationwide corporation.
In a news release, the company, which operates 162 restaurants in 20 U.S. states, said that sales for existing stores were down 39 percent last month compared to June 2019.
The company reported that “same-Shack sales remain acutely impacted by New York City, one of the Company’s largest regions with some of the highest volume Shacks, which is expected to take a longer period of time to fully recover than other parts of the country.
“For the most recent fiscal week ended July 1, New York City same-Shack sales were down (58%) versus the prior year, and with this region accounting for approximately 20% of the Company’s total Shack sales in the first quarter prior to the COVID-19 outbreak, it will continue to have a notable impact on total Company sales performance until there is a material recovery.”
Manhattan is emerging as the worst of the worst, according to Zane Tankel, who owns 35 Applebee’s in the New York City metropolitan area.
Tankel said he has reopened 18 restaurants, including in Brooklyn and Queens, but Manhattan is a different story.
“I drive around the city all the time and it was an easy determination to see that there’s not enough traffic to open those restaurants,” he told the New York Post.
Meanwhile, a Macy’s spokeswoman told the Post that “continued work-from-home trends mean fewer commuters coming into the city” and that tourism “remains low.”
Although Starbucks recently reported that only 5 percent of its company-operated U.S. stores are completely closed, Mark Kalinowski, founder of Kalinowski Equity Research, said those “are primarily located in the New York City metro area.”
“It’s not normal to see Central Park and Times Square empty,” Kalinowski told the Post.
Traffic at Lids, a sports cap company, is down 85 percent compared to last year at stores on Times Square and Broadway, said Lawrence Berger, chairman of Lids.
The company’s other 900 stores show a 20 percent drop from a year ago, he said.
“We expected New York City to be like the rest of the country when we reopened our stores here, but it’s a complete outlier,” Berger told the Post.
“There is no way to make money. It’s not an economically viable situation.”
The situation led the Post to report that retailers “say business in the city that never sleeps has become worse than anywhere else in the country.”
“The problem, sources say, is Manhattan, which used to be teeming with tourists and commuters — who have largely stayed away since the coronavirus pandemic hit in March. Wealthy Manhattanites also have more resources and flexibility to escape, indefinitely, to greener pastures, like the Hamptons, experts say,” the outlet added.
In an Op-Ed for The Hill, Michael Landau, a retired textile company owner who currently serves on the board of the nonprofit Palm Beach Center for Democracy and Policy Research, wrote that the coronavirus is not the only reason tourists are avoiding New York City.
In comments aimed at Democratic New York City Mayor Bill de Blasio, Landau wrote, “since you have been unable to control the violence and looting in your city in recent weeks, and with shootings and other violent crimes spiraling upward dramatically in the past two weeks, I honestly would fear for the lives of my family if we were to visit NYC now.”
Landau said he doubts New York City will be safe enough for his family’s annual Christmas excursion there.
“You see, your excuses and lack of intervention in allowing your city to burn, in allowing the destruction or defacing of statues and buildings, in allowing police officers to be challenged, threatened and injured while the perpetrators go free, in allowing mobs to take control of your streets or even whole neighborhoods — all of that will keep us from spending our hard-earned money, or risking our personal safety, in your city,” he wrote.
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