Amazon is taking NYC’s lunch money

Amazon is the elephant, we are the blind men gathered around it, each feeling a different part and none in agreement with ‘what it is’. I walk around it and describe what I feel at each stop.

So far, this is what I’ve touched:

Amazon is eating New York City.

A decade ago Walmart wasn’t allowed into New York City, civic virtue, unions, local politicians and the public outcry had a moral authority. A moat was dig around the city that kept the big box stores out.

The big pharmacy chain stores seized the opportunity, they already were already inside the castle. They had a scattered retail presence in the city, mostly moderate sized stores that sold basic over counter pharmacy items and assorted conveniences. Those stores became megas, they gobbled up enormous retail spaces and chased the mom and pop stores into the outer boroughs. Then the mega stores went into the vulnerable outer boroughs. The mom and pop stores have suffered an unnatural death. They have been targeted for assassination. The unions, local politicians and public outcry wants it this way.  ”

New York City has the power to stop it and to restore middle-class equilibrium.

The real estate industry is aligned with Amazon and the megas. Those retail forces can outbid everything in their way and drive retail rental rates higher.

History has solved this problem before. No perfect solution but these have worked before:

  • Imposing a surcharge on vacant property over and above the property tax. This resolves some part of the problem of a storefront that stays empty for months at a time. Landlords sometimes jack up the rent not because they have a chain tenant in the wings, but because they hope to snare one. The landlords call them “credit tenants.” In the meantime, there are tax deductions to be claimed. And if the building was a recent purchase, the landlord is paying off the acquisition at interest rates much lower than those that would have prevailed at any time in recent history.
  • San Francisco has a law that, under certain circumstances, allows neighborhoods to vote on which chain stores can locate in the area.
  • San Diego passed a measure to require retailers of more than 90,000 square feet who sell groceries to conduct an economic impact analysis before proposed stores can be approved. 
  • Maine requires cities and towns to conduct impact studies and only approve the stores if it’s found they have no adverse impact on jobs, local businesses and municipal finances.

The end?