NEW YORK CITY-The Big Apple may be home to many large corporations but it is increasingly the place in which entrepreneurs are making a mark, according to a new report from the Center for an Urban Future. And not only are many more businesses starting than the number of businesses that were launched 20 years ago, Manhattan is no longer the only borough where every business wants to be, the report says.
“Nearly twice as many new businesses were incorporated in the city in 2011 than in 1991,” says an announcement of the report. Also surprising: the fastest growth in startups was seen not in Manhattan but in the outer boroughs, the announcement says.
“We're in a new entrepreneurial age in New York,” declares Jonathan Bowles, executive director, Center for an Urban Future, to GlobeSt.com. “It's much more a part of the city's DNA than it was 15 or 20 years ago.” By comparison, , in 1991, 35,218 new businesses filed incorporation papers in the city, according to the report. By 2011, that number increased to 65,658, an 86% rise.
Boroughs shared the wealth, the report notes. The Bronx had the fastest growth in new business incorporations, going from 1,159 in 1991 to 4,690 in 2011. Brooklyn—which Bowles notes has grown extensively in terms of population, and then in businesses to support the increase in residents—jumped from 7,419 new businesses in 1991 to 19, 351 in 2011. Queens and then Staten Island followed suit; Manhattan took last place.
Commercial real estate developers can take advantage of this trend by doing what they do best: providing space.
“Given the explosion of these 'business births' outside of Manhattan, there may be growing demand for affordable commercial space outside of Manhattan,” says Bowles. “There's a lot of competition for limited space in the boroughs.”
He cited several areas where this issue is present. “Dumbo is pretty much full and it's incredibly attractive for technology companies. Or look at Main Street in Flushing, 74th Street in Jackson Heights or 5th Ave. in Park Slope—rents have risen in these retail corridors,” pricing new businesses out of these areas, he notes.
Though the report only covers what has transpired, Bowles made some forecasts based on the research. “We all know that the vacancy rates in Midtown South are really tight, but I think a lot of growing entrepreneurial ventures want to be in those kind of buildings—Class B space with cheaper rents and interesting neighborhoods,” he says.
“Those types of facilities are in demand for creative and technology companies,” Bowles continues. “I don't know where they're going to go but they're not all going to be able to stay in types of areas they are in now.”
And expansion or new commercial space outside of Manhattan and even beyond Brooklyn would be a wise move for developers, he says. “There's growth outside of Manhattan in several sectors, like healthcare and education services,” according to Bowles. Population growth in surprising areas of the city also would support new commercial space.
“For much of the last 20 years, Staten Island has been one of the fastest growing counties in the state, in terms of population growth, and business investment has followed. People that have moved there have started companies, including retail operations and services,” he says.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
