Although the Elm City has seen a spike in the turnover rate among its retailers and restaurants over the past year, the worst may be over.
Since May, several well-known businesses, including Ann Taylor Loft, Blockbuster, Paul Richards, Gastronomique, Villarina’s and Katz’s II on Temple, have closed shop. But while some of the empty storefronts around town have remained empty longer than usual due to weaker rental demand, a number of others have already secured new tenants.
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“I have never seen a worse year for commercial real estate,” said John Wareck, president of Wareck Real Estate in New Haven. “[But] my projection is that the market has just about bottomed out.”
Wareck, who helped draw stores such as Starbucks, Buffalo Wild Wings, Ann Taylor Loft and College Wine to take root in downtown New Haven, said the current economic downturn is pushing landlords to offer concessions such as free months and rental discounts in order to attract tenants. In the meantime, residential occupancy downtown has remained in high demand, with a 90 percent occupancy rate — a signal that city retailers can expect to retain a steady customer base through the economic cycle, he explained.
Yale University Properties, which currently has 21 vacant properties listed on its Web site, has responded to the weak demand by stepping up their efforts to attract new tenants, employing new public relations techniques, special events and viral marketing, said Lori O’Connell, manager of real estate for University Properties.
New Haven, both Wareck and O’Connell said, hasn’t been hit as hard as many other cities. O’Connell said University Properties has seen an increase in rental activity in the past nine months, though she declined to provide specifics.
Some local store owners interviewed said they are seeing evidence of this renewed business confidence: “For everything that has closed, something has opened,” Frank Criscuolo, co-owner of Chapel Street staple Claire’s Corner Copia.
Kerin Boutique, an eco-conscious clothing store for women, is set to open on the former site of shoe store Paul Richards, which shut down this summer. Construction workers toiled in the still-unfinished space yesterday afternoon. Meanwhile, Ay Salsa!, a Latino restaurant, has lofted its nameplate over the void left by the closing of Gastronomique on High Street.
Where Blockbuster used to stand (the video store shut down in May, just as students left town for the summer), a new buffet-style restaurant called Bulldog Food Court just celebrated its second week of business. Restaurant manager John Chen said on Sunday that the store has already provided the catering for the Yale International Students Organization and expects good business from the influx of Yale students returning to campus.
“We have spent around $1.3 million on furnishing and renovating the store, and we hope to recoup these costs within a year,” Chen said, adding that he is optimistic of his business prospects.
“If parents can afford to send their kids to Yale, then surely these kids can afford to eat here,” he added.