The Real Deal New York

Hip Nolita eclipses Little Italy

By Tom Acitelli | October 17, 2007 11:43AM

The decline of Little Italy is a familiar story that New Yorkers can trace over decades. The once solidly ethnic enclave’s fortunes have sagged since its prewar heyday, and the newest chapters in its history are among the final developments stripping the East Side neighborhood between Canal and Houston Streets of its Italian identity, first established in the 1890s. Call them Greater Soho and Nolita.

A one-time cultural and culinary touchstone, the neighborhood, once distinctly sprawling from its nexus at Mulberry Street, has over the past few decades all but disappeared. Encroachment from adjoining Chinatown and Soho – as well as the exodus of residents of Italian ancestry or origin – has left what remains of Little Italy a kitschy tourist trap and a clump of increasingly expensive five- and six-story walk-ups.

Cold-water tenements a few generations ago, the buildings of Little Italy are now a part of what could be called Greater Soho. They’re sought after because of the old real estate adage: location, location, location. The eastward migration of ever-trendy Soho has even spawned one of Manhattan’s newest neighborhoods: Nolita – “North of Little Italy.”

Bounded roughly by Lafayette Street and the Bowery, Nolita and Little Italy are caught in a real estate reality not of their making. They just happen to be in a part of Manhattan that has morphed the last 15 years into a hot or, more accurately, expensive place to dwell. Still, together they remain one of the few areas below 14th Street where a one-bedroom apartment can rent for $2,000 a month, a relative bargain.

“You can still find a fairly good deal because it’s becoming Soho, but it’s not quite there yet,” said Kristin McLaughlin, a broker with City Pad Real Estate. “Little Italy doesn’t seem to really exist anymore. It’s more and more Nolita-slash-Chinatown.”

An 1,800-square-foot two-bedroom apartment is going for nearly $1.67 million, McLaughlin said, adding that it’s slightly less than what it would be in Soho. A one-bedroom can go for less – just over $1 million, according to various sources. A loft can rent for between $4,000 and $5,000 a month, and a one-bedroom in a walk-up is a relative bargain at $2,000.

But gone are the days of the neighborhoods as an ethnic enclave, where mobsters like John Gotti and Joey Gallo mingled with merchants who served the same customers for years – then their grandchildren. The two neighborhoods now have fewer family households, according to the 2000 U.S. Census. The four Census tracts that roughly cover Nolita and Little Italy included around 3,450 family households and more than 4,100 non-family households.

The neighborhoods are getting younger, too, according to the Census, with the vast majority of its more than 16,800 residents between the ages of 18 and 64.

While prices increase, the architecture will likely stay the same. No high-rise construction projects are expected in Nolita and Little Italy, just more trees.

Since 2001, the city’s Special Little Italy District designation has shielded both neighborhoods and some surrounding blocks from development that doesn’t “preserve and enhance the historic and commercial character” of the area. Any development or rehabilitation has to be on a scale with existing buildings, and the retail area along Mulberry Street – the drag of Italian restaurants and tchotchke stands that draw most of the tourists – is also protected from major changes. The district mandate also encourages the planting of more trees in the neighborhoods.

Several residential buildings in Nolita have been renovated in the past decade, and it remains the hotter of the two neighborhoods, according to brokers.

Little Italy’s border with Chinatown and that neighborhood’s decades-long encroachment have made the northern blocks of Nolita a more sought-after address. Rent stabilization also kept many Little Italy apartments beyond the reach of higher prices, even though that’s changing as landlords cash in on the neighborhood’s shifts.

Nolita now features the samy types of boutiques and diners endemic to Soho, making it a trendy destination even for those who don’t pine to live there. Nolita, after all, arose largely because retailers wanted out of the higher commercial rents in Soho.

“It’s all about the blocks,” said Adelina Nenkova, a broker with Citi Habitats who has brokered apartments in the neighborhoods for two years. A building too close to Chinatown, but still in Nolita/Little Italy, may not have as much cachet as a building smackdab in the middle of Nolita. Blocks count in these compact neighborhoods.

Generally, a small 400-square-foot apartment in Nolita can rent for between $2,200 and $2,500 a month, depending on the age of the building. Nenkova said many of the people paying these prices are young professionals, which may help explain the changing demographics.

With its strategic location – within walking distance to New York University and several surrounding neighborhoods in lower Manhattan including the Financial District – Little Italy and Nolita’s transformation should continue from ethnic oasis to an extension of the very Soho that people came to Nolita to escape.

The low availability of apartments is an indicator that its popularity, if not the quality of its pasta fagioli, won’t wane any time soon.

“There’s just not a lot of vacancies,” Nenkova said.

Comments are closed.