More creative-services firms and nonprofits are relocating to lower Manhattan, challenging the dominance of old-school Wall Street in the nation’s financial capital.
Since the start of 2005, over 30 percent of the new office leases for relocations to downtown from elsewhere in the New York area have been signed by companies in the creative services and nonprofit industries—the funkier brethren to the area’s staid commercial engines of big law and even bigger finance; about 54 percent of the relocation leases have been signed by companies in that more traditional Wall Street orbit, including insurance and real estate firms.
The biggest creative-services lease has been Niche Media’s 45,000-square-foot one in the Sapir family’s 100 Church Street. Niche—publisher of slick magazines like Hamptons, Gotham and Aspen Peak—will move early next year from 257 Park Avenue South.
“Location and pricing and the proximity to Tribeca and SoHo were key factors in the move,” said Neal Sroka, a broker with the Corcoran Group who handled the deal for Niche. (The building’s landlord, Alex Sapir, told The Observer for another story that 100 Church’s rents range from $40 to $49 a square foot.)
The second- and third-biggest creative-services leases have been publisher and design company McCall Pattern—43,403 feet at 120 Broadway—and marketing firm Global Hue’s 40,000 feet at 123 William Street.
In the last two and a half years, there’s also been The Paris Review, The Jerusalem Post, WOR Radio, James Dart Architects, Push Creative, Little Airplane Productions and on and on, a litany of monikers one doesn’t normally associate with the concrete canyons of Manhattan’s tip and that includes nonprofits like Habitat for Humanity, UNICEF and the New York Landmarks Conservancy.
Subtle, yet titanic changes have loosed lower Manhattan from the grip of the I-bankers and bond traders who head back to Greenwich or Gramercy at the end of the working day and have handed it over to a more economically diverse clientele.
“There’s been an arts community in lower Manhattan for 30 years, and it’s just growing; and it’s sort of reached critical mass here, and that’s raised the profile,” said Nicole LaRusso, vice president of economic development for the Alliance for Downtown New York, the city’s biggest business improvement district.
The Alliance compiled data on relocations to below Chambers Street since the start of 2005 by 171 firms leasing 3,864,864 feet. Most firms relocated from midtown, where per-square-foot annual office rents can run twice those in downtown. The most expensive midtown rents can range into the high $100’s a foot and the cheapest into the mid-$30’s, depending on the location and the physical quality of the office, according to brokerage analyses. In downtown, far fewer dollars separate the cheapest and the priciest rents—a range of around $30 to $80 a foot.
Retail has also served as a siren for relocating companies, especially retail at the higher end—Tiffany’s will open a store this week on Wall Street; Hermès and Thomas Pink already have. Also, the simple essentials that many New Yorkers take for granted—dry cleaners, fancier restaurants, grocery stores open late, etc.—have multiplied in lower Manhattan.