Through the years, Seventh Avenue in Park Slope has been something of a model retail corridor.
In a neighborhood that prides itself on shopping locally and eschewing national chains, residents have enjoyed that the 17-block stretch between Flatbush Avenue and Ninth Street in particular was packed with a slew of mom-and-pop shops, local restaurants and trendy boutiques.
And as the strip grew in popularity over the decades, landlords could count on keeping their ground-floor spaces filled fairly easily — at increasingly robust rents.
But in the last year, a wave of closures has resulted in a patchwork of dark storefronts, the likes of which have not been seen for decades, residents and brokers say.
Indeed, a recent informal survey noted about 20 empty retail spaces either facing Seventh Avenue or just off it, which is an unusually high number, according to brokers, landlords, business owners, neighborhood officials and residents.
True, some of those spaces are about to be filled, sources point out. Also, other shops seem to have closed for reasons that have little to do with the current downturn. For example, the Video Forum at 133 Seventh Avenue is closing because it was undermined by Netflix, a manager there said. Competition from burgeoning nearby retail areas may also be playing a part.
Yet high rents may be to blame, too. While those rents may be justifiable in landlords’ eyes, as the cost of owning property in the city has climbed, aggressive per-square-foot prices are coming at a tough time, as small businesses struggle to make ends meet in a still-ailing economy.
“I think more retailers would still be here if the overhead wasn’t so high,” said Barry Cohen, a longtime Park Slope real estate broker who knows many landlords on the avenue. “A small store can’t make it anymore.”
For his part, in February Cohen closed his storefront office, which he owns, at 20 Seventh Avenue, after 29 years, essentially to “scale back”– a move he said he was planning on making irrespective of the economy. Almost immediately, the space was taken by Healthy Body & Foot Rub. The lease runs for “less than five years,” Cohen said, without being more specific, though he strongly suggested that rent was in line with this part of the avenue — $75 to $100 a square foot.
Evidence of the larger trend of store closures, Cohen said, exists just around the corner. Last summer, Park Heights Stationers Copy Center, which was located at 164 Park Place, shuttered after 25 years, citing “the rising cost of operation,” according to a sign pasted outside.
Not surprisingly, many landlords and brokers did not want to comment about Seventh’s apparent struggles; representatives of the Park Slope Chamber of Commerce also did not return messages. But below, The Real Deal has compiled a breakdown of how the avenue is changing.
61 Seventh
After a 15-year run, Lemongrass Grill, a Thai restaurant located in a red-trimmed storefront at the base of a four-story apartment building near Lincoln Place, closed last month. Thai food fans may be happy to learn, though, that Spice, a similar eatery, will soon open in its place, said brokers who were not involved in the deal, but are familiar with the area. They added that Spice bought out the remainder of Lemongrass Grill’s lease for undisclosed terms, after approval by the landlord, Nancy Lopez. Lopez was not immediately available for comment.
70 Seventh
In fall 2010, Slope Sports, which specialized in running gear, shuttered after five years. Its blue awning is still in place, but the interior on a recent afternoon was empty save for a cardboard box topped with a Santa hat. It’s unclear what will go there next. The two brokers who are listed as marketing the space on signs on its window — Deborah Hollon of the Corcoran Group and Warren Lewis Realty — did not return calls for comment. But Louis Barricelli, who owns Cousin John’s, a next-door bakery that’s been there since 1986, does not fault the landlord, whom he declined to name. “He would be very negotiable with whoever would walk through the door, but right now people aren’t looking,” Barricelli said. The real culprit? Fifth Avenue in Park Slope, which has lured foot traffic away in the past five years as its retail options blossomed, Barricelli said. “A few years ago, nobody would walk on it, but now it’s vibrant,” he said. The Slope Sports space will likely lease for about $75 a foot, brokers said. That’s about the same as it would have been when the store opened in 2006, though about $25 to $50 higher than a decade ago.
72 Seventh
After two decades, La Taqueria, a well-liked Mexican restaurant, closed in January. Its unusually large 2,000-square-foot space, which has exposed brick walls, is still vacant. So far, some restaurants have expressed interest but no deals have closed, said Justin Dower, the director of commercial leasing for Ideal Properties, the brokerage now marketing the space. He said high rents weren’t to blame for the closing, necessarily, but rather bad recent hires on the management side. “It was a long spiral down for those guys,” said Dower, adding that asking rent is $8,000 a month, or $48 a square foot a year. That’s more than La Taqueria was paying, he admitted, but when they signed their first lease in the early 1990s, the market was in the doldrums and the Slope was still rough around the edges. He guessed that rents on the strip could have been as low as $12. Also, he noted that the $8,000 asking rent is far less than average on this stretch of Seventh. Plus, he said that Seventh Avenue landlords should be prepared to grant concessions in this market, which in the case of restaurants is usually three months of rent, to compensate for the construction costs of their build-out.
99 Seventh
Brooklyn-based Berman Realty owns several spaces along the avenue, including at least two that are now empty. One is this space, the former home of Super Savers Health and Beauty Aids Center, which closed this year. On a recent afternoon, brown paper covered the store’s blue awning in preparation for the opening of a children’s-themed store, brokers said. Joe Berman, president of Berman Realty, declined to comment.
96-100 Seventh/808 Union Street
Two of the five retail berths here are empty. The one at 808B, a 500-square-foot, sidewalk-level store, had featured a Tasti D-Lite until last March, but its lease wasn’t renewed because it was dripping water into a health club below, said Nicholas Kotsonis, the landlord. Last summer, Kotsonis was asking $132 a foot for the space, according to records kept by local brokers, though that price had dropped by 20 percent to $106 by last fall. And at 100B, which faces Seventh, a 1,500-square-foot branch of the Stanley Kaplan test prep company closed in January after a seven-year run. For a few months, it shelled out $130 a foot while trying to sublet the office, though nothing panned out, according to a source close to the negotiations. Then, in March, Kaplan broke the lease; Kotsonis will now market it himself and said that $110 a foot is probably more realistic for the current market. Kotsonis, whose family has owned Park Slope property since 1929, blamed Mayor Bloomberg’s tax raising for the “bizarre situation” on the avenue. “The properties were overvalued, so landlords have to pay more for them,” he said. “They have to pass some of those costs on to their tenants.”
162 Seventh
Last year, a shop called Chair-Man Gift and Home, which sold knickknacks near First Street in a 1,000-square-foot space — the standard size for this area — shuttered. Landlord Howard Katz is currently inking a lease with a travel agency, according to a representative from his office, who declined to release any other details.
170 Seventh
An attractive corner store with a jutting three-level bay window, this 1,300-square-foot, two-level space was occupied by Artesana Home, a décor retailer, until Jan. 31, when it closed after 11 years. Store owner Robert Lopez said he shut down not because of steep rents, but because the store was competing with another one of his businesses, El Milagro, which is still in existence at 370 Seventh Avenue. No. 170 will soon get a restaurant selling “organic hamburgers,” Lopez said.
219 Seventh
Living On Seventh, which sold stylish housewares, closed last year. In May, this narrow space on the slightly less desirable southern end of the avenue near Third Street will welcome Swiss Nails II, a nail salon, according to Chad Kessler of New Millennium Real Estate, the broker who leased it. But in a countercyclical move, the landlord, whom Kessler would not name, actually dropped its rent instead of raising it, he said. “It came down about 50 percent in just two years,” he said. Next door, the boutique City Casuals, at 221 Seventh, also appears to be on the move. In the middle of last month, a sign reading “Store Closing 50% Off” was in a window. The listed telephone number was out of service.
222 Seventh
Miracle Grill, a local Mexican restaurant at Third Street, called it quits in 2010. In February, it was replaced by an outpost of a national chain, Cheeburger Cheeburger, which has locations in 19 states. This southern part of Seventh tends to have more national retailers than the northern section: Rite Aid, Subway and Radio Shack are packed between Fifth and Sixth streets. Sometimes only deep-pocketed chains can afford Seventh Avenue’s steep rents, said Noel Caban, a broker with CB Richard Ellis who focuses on retail in Brooklyn. He said that local landlords seem to be “misreading the recovery” by charging too much. “I don’t want to be the hated guy,” Caban said, “but you have to set sustainable market rents.”
300 Seventh
In the past year, baby clothing store Peek-A-Boo Kids shuttered two locations on Seventh: this one at Seventh Street, which is still empty, and 78 Seventh, which is now home to a dry cleaner. Tim Betancourt, who owns Betancourt & Associates Realty, which is marketing No. 78’s 1,000-square-foot space, said the building’s owner, whom he wouldn’t identify, will open his own business there, though the build-out could take some time. For his part, Betancourt said the extended vacancies on Seventh, which are happening because a bunch of leases signed a decade ago are suddenly ending, are more a function of choosiness on the part of landlords than any lack of demand. “When it comes to a store, a landlord is more particular, because he will be with them for five to 10 years,” he said. “In my mind, it’s always about matching the tenant to the location.”