Broadway’s Extended Shutdown Deals Another Huge Blow to NYC Retail
The announcement today that Broadway will remain closed until May 2021 dealt a huge and immediate blow to actors, productions and theaters — but the ripple effects are certain to hit businesses in New York City’s once-bustling Times Square area hard.
Since the coronavirus took hold in the United States in March, government officials have enacted a range restrictions, including stay-at-home orders and shutdowns of non-essential businesses. And since March, New York — an epicenter of the crisis — has slowly reopened, becoming one of the last cities to offer indoor dining, for instance. Now in Phase 4, low-risk outdoor activities like botanical gardens and zoos have opened with capacity restrictions; professional sports resumed without audiences; and as of Sept. 30, indoor dining at restaurants is available at 25% capacity.
Retail stores have also been allowed to reopen since June 22 when New York hit Phase 2 of its reopening plan — albeit with uneven performance across outposts as tourism remains muted and locals exercise their own safety precautions by avoiding certain enclosed spaces. Meanwhile, the New York retail scene — characterized by its high rents –— was already in flux prior to COVID-19.
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Now, with dwindling foot traffic from tourists and office workers — many of whom are moving to semi-permanent remote work — challenges are reaching a fever pitch for companies in the Big Apple. For instance in May, Gap Inc. was sued by landlord 48th Americas LLC, who said the retailer had skipped out on two months of rent payments amid the coronavirus pandemic. If an agreement cannot be reached between the two parties, Gap could end up shutting its Midtown Manhattan outpost for good. Bankrupt JCPenney closed down its Manhattan Mall location in Midtown for the lockdown and will not reopen. The Hilton Times Square has also permanently closed.
For the 2018 – 2019 season, the total Broadway attendance reached nearly 15 million and Broadway shows yielded more then $1.8 billion in grosses, making it the best attended and highest grossing season in Broadway recorded history. Sixty-five percent of those admissions were made by tourists, according to Broadway League. In addition, during the 2018-2019 season, the Broadway industry contributed $14.7 billion to the New York City economy and supported 96,900 jobs.
Without Broadway’s contributions, forced closures and a slew of other negative consequences are only inevitable for Times Square tenants hoping to eke out a path to recovery.
