In a neighborhood where some landlords will let a space sit empty rather than lower skyrocketing rents, the space at 146 W. 26th St. did not stay vacant for long. Sandwiched between luxury boutiques and salons, Rock Star Crystals, a metaphysical and crystal goods store, opened recently in the space previously occupied by Revolution Books, a Communist bookstore that could no longer afford the rent.
The shuttered windows on the block symbolize a neighborhood that has seen much change in recent years. Once home to small, niche businesses and wholesale retailers who could lock in 20-year leases, Chelsea is now an expensive tourist destination, and mom-and-pop stores can no longer afford the rent once their contracts expire.
Florence Levy works at Rock Star Crystals and has been a Chelsea resident since the 1970s. Though the store signed a five-year lease, she said that the owners are afraid they will not have a business in six months due to high rent prices. But she said that maintaining a storefront presence in Chelsea is worth the risk.
“The area is less sleazy, but landlords can name their price now,” Levy said. “When your lease is up, they go sky high with the rent.”
Revolution Books rented their Chelsea storefront for eight years. When the store’s lease expired five years ago, it was allowed to remain in the space, paying half price until the building owner could find a new tenant who could afford the lease, said store manager Clark Kissinger. The store will reopen in Harlem in October.
Rock Star Crystals previously had a store on West 28th Street. Levy said the store was priced out of their old space when the building owner wouldn’t renew the lease after another business bought out the space.
While the asking price for rent was between $100-$175 per square foot for the 1,400 square foot space, Rock Star Crystals leased it at $95 per square foot, according to Kristen Crossman of CBRE research operations, which monitors retail value in Chelsea, making it one of the few relative bargains around. Levy would not confirm the exact amount.
The average household income in the area is about 1.7 times that of the average income in the Manhattan Borough as a whole, according to the most recent American Community Service figures.
Drew Lombardi, community liaison between Chelsea Community Board 4 and Manhattan Borough President Gale Brewer’s office, said maintaining diverse storefronts is important to the community’s continuous development. “It is always our priority to make sure small businesses are surviving and thriving,” Lombardi said. “The preservation of truly mom-and-pop owned diverse businesses is vital to any area’s success.”
Ercole Home, a custom furniture boutique, has occupied the space next door to Rock Star Crystals for the last five years. Nancy Henry, a store employee, said that while having a business in the heart of the Chelsea district close to a major subway is beneficial, the business struggles with rent pressures each month. Ercole Home used to be located in DUMBO, Brooklyn, but moving to Chelsea has attracted more clientele and tourists. “If it wasn’t for how sky high the rent is, it would be a perfect area,” she said.
A March report released from Manhattan Borough President Gale Brewer’s office offers a list of suggestions to help small businesses cope with the changing landscape, including 180 days of conversation between tenants and landlords before stores are asked to vacate. The report also recommends the government examine zoning laws that will make it easier for businesses to keep up with rent and hold roundtables with small business owners for feedback.
According to the report from Brewer’s office, many leases are becoming shorter, with many landlords avoiding 10 to 15 year leases, preferring to keep spaces vacant or in transition until they find bidders who can afford the higher asking prices.
For Revolution Books, however, the move wasn’t that bad, Kissinger said. After being given 30 days to vacate in May, the store launched an Indiegogo campaign to raise $30,000 to reopen in Harlem. The new space costs approximately 35 percent less per square foot compared to what they paid in Chelsea.
For the sake of Rock Star Crystals’ future, Levy said she hopes the city will do more to keep rent prices down. “Sometimes I’m not too sure change is always good if it has to do with people and people have to move,” she said.