Sunday, February 17, 2008

Got Any Cash To Spend?

I walked from Fulton Street all the way up to 23rd Street today and noticed tons of empty storefronts with "Commercial Space For Rent" signs.

Even the venerable Soho shopping district had some, though the area just below NYU around Astor Place seemed pretty hard hit. One block had three empty storefronts and the space where Barnes and Noble used to be around the corner is still empty.

The Barnes and Noble on 6th Avenue and 21st Street is also going out of business in March. I've noticed quite a few other stores with "Going Out Of Business sales (and not the usual scam "Going Out Of Business" sales some stores use to draw in tourists.) CompUSA is closing all their stores including the one on Fifth Avenue and 36th Street and the one on West 57th Street.

According to a store clerk at the B&N in Chelsea, insane rents are putting many of these stores out of business, but with retail sales down pretty drastically the last few months, I imagine lack of customer traffic must be adding to the problem. Even when retail sales numbers increase, as they did last month, it's because of inflation rather than an increase in actual sales. As Floyd Norris wrote in the NY Times recently, Americans are spending 13% more on food and energy this year than last year, which means that

FACED with tightening credit and a slowing economy, America’s consumers are being forced to scale back their purchases, but high prices of necessities are keeping their overall purchases rising at a reasonably strong rate.

We're buying less but paying more for what we have to buy. Not a good trend overall considering consumer spending accounts for 72% of the American economy these days.

Dunno if that is why so many commercial and retail spaces seem to be empty around Manhattan, but something sure seems to be happening around here.

What about where you are? Notice an increase in stores going out of business or commercial spaces staying unrented for long periods of time?

And how about your own spending? Are you holding back from purchases because you're worried about a near-term economic slowdown or buying things per usual?
blog comments powered by Disqus