The Hub—The Bronx’s oldest shopping and commercial district located in the South Bronx neighborhood of Melrose is going through the most profound changes since the 70s and 80s when the neighborhood burned around it and its main train line, the Third Avenue El was put out of service and torn down.
Since its beginnings over a century ago when the borough was experiencing a population boom adding over 1 million residents in a span of 30 years, Melrose and The Hub, attracted residents from all over The Bronx due to it being an excellent transportation nexus—and still does today.
New “affordable” housing developments have been constructed surrounding the area and adding over 3,000 apartments and tens of thousands of new residents—with thousands of more units in various stages of construction or planning to come.
As gentrification tightens its grip on the South Bronx, long-time businesses are closing their doors as landlords either are not renewing leases or simply the new rents are too high to keep up.
A whopping 25 storefronts are now vacant with only a couple actually having tenants moving in. Welcome to The “New Bronx” that our borough president Ruben Diaz Jr touts, where gentrification is driving long time businesses away.
And why? Because the basic rule in real estate: Location, location, location. The Hub is a major transportation, well hub, with the 2 and 5 line stopping at 3rd Ave and 149th Street and being only two stops away from Manhattan further increases the area’s value to real estate developers and speculators—you can literally get to midtown with 15 minutes.
Watch: Take a walk through the neighborhood with us:
One such store to succumb to this in recent months is Revolution, a woman’s clothing store, which was at the old McCrorey Building on Third and Westchester Avenues. The store was serving the community for close to 30 years but as their lease expired, they were unable to renew at the higher asking rents.
Now, in its place, the national retailer Footlocker is taking over the space, as they consolidate two existing stores, and are in better positions that can afford the higher rents in the area.
Five years ago, Planet Fitness, a national chain of gyms, opened up in The Hub which was shortly followed by The Children’s Place, another national chain.
Now, where once stood mom and pop businesses that took over from those who fled The Bronx are being pushed out as confidence in the area by these national chains. Since the opening of Planet Fitness 5 years ago, The Hub now is home to Carter’s (another children’s store), a Boston Market at Triangle Plaza on 149th and Bergen, as well as two luxury boutique hotels: The Opera House on 149th Street and The Umbrella on Elton and 153rd.
Crystal Party Store at 2962 Third Avenue at 153rd Street also lost their lease and in August they were pushed north to 1997 Jerome Ave in Morris Heights.
Now, Petland Discount is moving into the space.
You see, this is what gentrification does time and time again; it displaces long time family businesses. Crystal Party Store not only lost their space but now they also lost a huge swath of potential customer as the foot traffic in The Hub is the highest outside of Times Square with over 200,000 pedestrians walking by 3rd Avenue and 149th Street on a daily basis.
The carnage of vacant stores isn’t confined within The Hub “proper” but has spilled over to Melrose Avenue as well as 149th Street.
Landlords are no longer negotiating the typical 10-year leases that were customary and are now offering leases as short as 2 years—a tactic used by landlords to squeeze as much money out of properties as possible.
Orva Shoes, a boutique store from the Upper East Side opened its first store outside of Manhattan on Third Avenue in 2014 and now they are shutting down as the new lease was much higher than they can handle.
On Melrose Avenue, two stores at 617 Melrose Avenue closed after their short-term 3-year lease was up and the landlord raised the rent far beyond their reach.
650 Melrose, a mixed residential and commercial building, was sold last year in December for $3,050,000 and within a month, a bodega and a 99 cent store that rented space in the building were evicted as the businesses were struggling to pay their rent. The previous owner worked with the two businesses to keep their doors open but the new owner simply shut them down.
Now, as landlords wait for higher paying tenants, those spaces are adding more vacant storefronts in what was once a thriving shopping district. It’s a gamble that can pay off big time for a landlord as they warehouse these spaces until the highest paying tenants arrive. Oftentimes whatever they lost during the vacancies of their properties, they can recoup it rather quickly with a chain store or national retailer and pocket a profit at the same time.
A good chunk of these lost businesses could have been saved by the Small Business Jobs Survival Act (SBJSA)—a bill which would offer protections to small businesses with two particular rights:
- A minimum 10-year lease with the right to renewal, so they can better plan for the future of their business.
- Equal negotiation terms when it comes time to renew their lease with recourse to binding arbitration by a 3rd party if fair terms cannot be found.
Sadly, this bill has been languishing 30 years in New York City Council as it has been denied a vote due to the lobbying efforts of the ever-powerful Real Estate Board of New York (REBNY), a group that is one of the biggest campaign donors in NYC.
While it is natural for change to happen with the ebbs and flow of the economy and businesses succeed or fail, it is anything but natural when everything is done to derail these businesses from their established spaces.
It’s an insult to all who stayed behind during the worst of times and rebuilt the area. Now, they want to take all that work away from us.
We can and need to do better.
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