Vacant Storefronts Line Eighth Ave. as High Rents Force Out Businesses

By Mathew Katz on February 4, 2014 7:02am 

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Whatever Happened to Eighth Avenue?
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DNAinfo/Nigel Chiwaya

CHELSEA — For 20 years, Eighth Avenue was Michael Turowsky's home. He ran the Paradise Cafe where he served snacks, coffee and conversation under a bright rainbow flag.

That ended in July when rent for the cafe space at 139 Eighth Ave. abruptly doubled and he was forced to close up shop. Turowksy has barely been back to the neighborhood since.

"There's no Chelsea anymore. Chelsea itself needs to be redefined," Turowsky said in a recent interview. "The Chelsea that I remember, it was more funky, man. It was comical, it was unbelievably gay-friendly.

"Now it's associated with gloss, flash and expense."

The neighborhood's ongoing transformation stretches back a decade, but in the past year the changes have hit a stretch of Eighth Avenue between West 14th and West 23rd streets particularly hard.

More than a dozen businesses on that stretch shut down during 2013 and early 2014. Many storefronts remain vacant as landlords hope to draw in tenants that can pay huge monthly rents.

The businesses run the gamut — many had been in the area for more than a decade, but even a Pinkberry at 170 Eighth Ave. shut down.

For many of the longtime tenants, it's the same story. Seemingly out of nowhere, the landlord doubled or tripled the rent, they said.

Last March, beloved leather bar Rawhide at 212 Eighth Ave. closed after rent rose from $15,000 to $27,000 a month. Close to a year later, it remains vacant.

Camouflage, a clothing store that opened in 1976, followed in Rawhide's footsteps when it had to shut down last month after its rent jumped from $7,000 to $24,000, the business owner said.

Tenants said the High Line, Chelsea Market and Google's New York headquarters have made Chelsea a worldwide tourist destination, in a shift from its former reputation as an LGBT haven.

"The neighborhood is indoctrinated with tourists, people visiting the High Line and Google," said Norm Usiak, who owned Camouflage. "They don't come to small stores, they want to go to chains, places they know."

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 Many longtime Chelsea shops and restaurants have closed over the past year.
Shuttered Eighth Avenue Shops
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Landlords said they feel for the businesses, but can't turn down the promise of cashing in.

"I feel bad for them, but when our management company and broker says we can easily get double or triple, you just can't say no to that kind of money," said a member of the co-op that owns the buildings that once housed Camouflage and Paradise. He spoke on the condition of anonymity.

Landlords for many of the other storefronts either declined or did not respond to a request for comment. 

People living in the area were at first saddened when their favorite stores and restaurants began to close down — and months later, they're worried that many are still vacant.

"I'm concerned at the amount of open real estate," said Mark Johannes, 57, who's lived in the neighborhood for 30 years. "I don't know how retail can survive with rents like these."

Several real estate brokers said that individual landlords can cover most or all of their expenses with the area's sky-high residential rents, so they're happy to keep stores empty until they can get a tenant that's willing to pay a premium for Eighth Avenue space.

That strategy may not be paying off. The Chipotle-style pizza chain Project Pie was set to take over the Rawhide space, but plans fell through and the storefront is once again up for lease.

"Who can afford that space? The rents are getting so high for business owners that the only ones that can afford them are chains," said Laura Evan, 44, a 12-year resident of Chelsea.

"It's changed the whole dynamic of the neighborhood, it detracts from the flavor and, as a homeowner, I'm afraid of what that means for resale value."

People who live in the area said they're fearful that they're also going to be priced out as a result of commercial rent increases. Prices for food, drinks and other staples have risen with the cost of rent. The moderately priced diner Redwood Kitchenette was replaced by the high-end juice spot Liquiteria. Juices there range from $6 to $9 a bottle. 

"If I came in and opened a place that was $30-a-plate, I could maybe do it at that rent," said Paradise Cafe's Turowksy.

For the most part, the former owners of Chelsea's longtime favorites say they're not angry. They speak of feeling resigned, or even surprised that they lasted so long after Chelsea began to change.

"Chelsea's been on the move for a decade — it was inevitable," Turowksy said. "I'm not bitter — it sucks and it hurts, but I do understand progress."

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