Rethinking Retail In A Revitalized Downtown Manhattan
The most significant, and surprising, part of Downtown Manhattan’s revitalization is its new retail wave, from Brookfield Place, WTC Oculus and the South Street Seaport to Target, Whole Foods, Apple and (possibly) Uniqlo.
The owners of this new retail aren't just rethinking how they can appeal to the market’s new demographics, but they're working together to make sure it can be successful and form a “river-to-river” retail network.
Westfield World Trade Center SVP Michael McNaughton (pictured) said Downtown used to service only the employees of financial firms, but now is pulling in major numbers of residents, transit riders and a rapidly expanding tourist base. The area saw more than 55 million tourists last year, and he expects that number to skyrocket in years to come as more take advantage of the Fulton Street subway station and the Brooklyn ferries.
Brookfield Properties SVP Michael Goldban also marveled at the area’s tourism shift.
“People used to only come to Financial to see the Statue of Liberty or get a picture of themselves on Wall Street,” he said. “Now people are spending a whole day here.”
The demographic shift caused developers to rethink who they are trying to appeal to. Usually, McNaughton said, a project would be conceived with only one or two of the above groups in mind, but the Oculus, Brookfield Place and the Seaport were experiments to see if a project could be designed around all four.
The Howard Hughes Corp senior EVP Christopher Curry (pictured) said the Seaport has always attracted tourists and travelers with its historical appeal, but the company has made the effort to talk with office tenants and residents in the area to see what they felt was needed.
The Seaport's new iPic theater was meant to address the area’s lack of entertainment options. And since it’s been developing over a lengthy time period, HHC can continuously engage with community feedback and shift leasing strategy as necessary.
That's why there has been more focus on food options and entertainment. With the increasing prominence of technology, every demographic wants a place to hang out and have face-to-face interaction, but technology’s convenience means retailers need to offer something impressive enough to incentivize someone to get off their couch.
For McNaughton and the Oculus, that means having daily event programming like art exhibits, ballet shows and performances by John Legend. Goldban (pictured) said he's impressed with Grand Central’s food hall’s ability to bring people together, even during the late hours of the night.
This fight against technology is also what incentivizes the three retail complexes to work together rather than struggle for dominance. Goldban said it was important to have different experiences between all three sites in order to create synergy.
Chris (left, with moderator and Rosenberg & Estis partner Michael Pensabene) insists the Seaport’s not a mall, and Howard Hughes isn’t a mall company. Goldban said Brookfield is just trying to create great spaces.
“Retail is a commodity that can create the personality of the space above or around it,” he said. “So our team works hard to sweat the details to make [Brookfield Place] as amazing as possible, from marketing to visiting marble quarries in Italy.”
McNaughton believes the Oculus drives the experience for the WTC complex, despite the fact that its 365k SF space comprises less than 3% of the 12M SF complex.
“We have to meet the needs of a wide variety of people in the space and take a wider approach to the surrounding area,” he said. “We constantly ask ourselves ‘how do we make sure our merchandizing resonates with all of those in the area?’”
The only threat to continued retail revitalization that the three saw came down to infrastructure limitations and a government not doing its part to keep the city safe and business-friendly. But, with the Port Authority trying to place an increased focus on improving transit, McNaughton said, that may not be an issue.