At last week’s Municipal Arts Society Summit for New York City, a panel discussed how skyrocketing real estate costs are affecting the city’s ability to attract and sustain new businesses.
Last week, the Municipal Art Society hosted the MAS Summit for New York City. Attendees gathered from fields including planning, development, and design to discuss the future of cities and place, in New York and beyond. As New York changes, the way people live, play, and work will change with it. Several sessions addressed how the culture and landscape have been shaped by the shifting forces of urbanism, and how they will continue to evolve.
If you can make it here, you… must be crazy?
While it has long been viewed as a haven for artists, creatives, and businesspeople to pursue their passions, many worry that skyrocketing real estate costs in New York will deter entrepreneurs from coming to the city, and make it increasingly difficult to settle and build a business. The panel discussing this topic agreed that entrepreneurism still has a place in New York, but regulations and relationships between entrepreneurs, and between them and city agencies, must adapt to keep attracting and sustaining new businesses. Rachel Newton Bellow of Mind + Matter Studio pointed out that the unique culture of a city is a major part of what draws talent, and that certain entrepreneurs will continue to seek out New York for the specific ethos they want. Colin Miles Campbell of Wikiburg, however, encouraged entrepreneurial communities to embrace online connectedness as a supplement to offline community.
Entrepreneurism still has a place in New York, but regulations and relationships between entrepreneurs and city agencies must adapt to keep attracting and sustaining new businesses.
Other panelists stressed that the term entrepreneur itself likely alienates many small business owners and independent workers who don’t see themselves fitting the mold. Jefferson Mao, an urban planning graduate student at Harvard and blogger at Flushing Exceptionalism, offered the example of the many immigrants in his home neighborhood who start and run their own businesses as subsistence, not with the intent to disrupt an industry. Michelle Byrd of Run it By Byrd also mentioned that individuals in media and the arts often do not connect themselves to the archetype of what many consider to be an entrepreneur.
Mao and Byrd agreed that the resources we typically associate with tech entrepreneurs and startup culture are not available to most subsistence and non-profit entrepreneurs, and that government outreach and administrative structure related to small business support should be reconfigured to better assist all types of boot-strappers and small businesses, not just those who fall into the tech/startup category. Still, another discussion with Ashwini Chhabra of Uber (formerly of the New York City Taxi and Limousine Commission), David Hantman of Airbnb, and David Weber of the New York Food Truck Association highlighted how even the companies we traditionally associate with entrepreneurism frequently run into regulatory battles in New York – a notion supported by Manhattan Borough President Gale Brewer, who expressed her commitment to keeping Airbnb out of the city during a panel the following day. Legislation and policies seen as outdated by many startups, but necessary by many city officials, are a regular point of tension.
The workplace of NYC’s future
So where will the workplace of the future be in New York, and what will it look like? Extremely high commercial rents in Manhattan are pushing many smaller businesses to the outer boroughs, especially Brooklyn and Queens, for affordable space, which was discussed on the “Future of the Workplace” panel. Dan Bodner of Kushner Companies said that even more traditional or mainstream companies are gravitating toward properties that reflect “the new workplace,” even in other boroughs, and that flexibility of space is becoming more important, particularly when companies take into account their employees’ lifestyle choices and preferred residential neighborhoods. Bodner mentioned that analyzing employee commute time often goes into a company’s choice of location or relocation. Seth Pinsky of RXR Realty also stressed the growing emphasis on transit-oriented development sites and ensuring sensible commute times when possible.
Getting out of your silo
For a growing number of organizations, breaking out of industry-specific spatial and geographic silos is increasingly important when considering workplace location. Andrew Kimball, CEO of Industry City, has seen in his own work how important it is for many tenants to collocate with different industries and have the opportunity to feed off one another, particularly as more crave urban areas for their work and creative types gravitate toward maker spaces. Like Kimball’s Industry City, in Sunset Park, new workplaces are popping up in unexpected neighborhoods as they transform and push out from the Manhattan core. In a discussion on the future of the East River waterfront, panelists predicted major growth in those neighborhoods along the river, even large commercial properties. Helena Rose Durst of The Durst Organization and New York Water Taxi, saw the area as a platform for a paradigm shift in corporate real estate, where a tenant like WeWork might be considered an anchor tenant rather than a traditional corporation.
Kyle Kimball, President of the New York City Economic Development Corporation, even predicted a shift of some corporate headquarters to new neighborhoods and boroughs, away from traditional Manhattan neighborhoods – but like those on panels before them, the speakers generally agreed that there would always be a demand for prime Manhattan corporate real estate. However, the Summit’s events and conversations made it clear that the climate of work in New York City will continue to change rapidly in the coming years, and it still remains to be seen how and if real estate and regulations will adapt to fit the evolving nature
