Recession Hasn’t Slowed Lower Manhattan’s Growth

June 8, 2010

New York--In 2009, total sales outpaced supply in this neighborhood.

20 Exchange Place was converted from commercial to residential in 2008. According to the Downtown Alliance, Lower Manhattan’s housing inventory has grown by more than 6,000 condo and rental units since 2007 and the district’s population has more than doubled–from 25,000 to 55,000–since 9/11.

New York—Despite the recession and the troubles that many financial companies are facing, Lower Manhattan continued its transformation into a growing, mixed-use neighborhood where more and residents are choosing to settle down, according to a new survey by the Alliance for Downtown New York.

James Yolles, director of public affairs at Downtown Alliance, tells MHN, “You’re seeing prices going down everywhere but there are indicators that are encouraging, showing us that the market remains strong here even though prices have slipped. For example, in 2009, total sales outpaced supply in this neighborhood. In addition, average pricing for Lower Manhattan apartments rose from the fourth quarter of 2009 to the first quarter of 2010 to reach $970 per sq. ft., which we find encouraging because pricing typically drops in the first quarter, which is the slow season for New York’s housing market.

The survey finds that an overwhelming majority of current residents (88 percent) plan on staying in Lower Manhattan for at least the next three years and that nearly half of residents (47 percent) own, an increase from 40 percent ownership in 2007.

“The residential growth in Lower Manhattan has supported the commercial vitality of the area, which sets up a new 21^st century model for the way a business district grows. There are new hotel openings, more diversity as far as restaurants and nightlife goes and retailers are noting that there are more and more families living here,” Yolles adds. And they are affluent well-educated families. With an average household income of $188,000 and a median income of $143,000, the typical household in Lower Manhattan boasts income levels significantly greater than Manhattan overall. On average, 85 percent have a college degree, and 42 percent have done post-graduate work, compared with 39 percent of residents city-wide and 57 percent in Manhattan who have college degrees.

Lower Manhattan’s growth seems to have really picked up since 9/11. “Population has more than doubled since 9/11 and to put it in perspective, there were about 800 people below Chambers St. in 1970 and 14,00 in 1993 so it has really exploded. It is no longer the urban frontier, which is what people thought about it a decade ago. It’s the place to be now,” says Yolles. Today, there are 55,000 residents and 27,881 residential units below Chambers Street. In 2000, those numbers were 24,400 and 13,901, respectively.

Several factors contribute to this growth. 87 percent of survey respondents said that the area’s overall quality of life was a key reason for choosing to live in Lower Manhattan; trailed by 84 percent who cited the quality of their apartment; 82 percent, access to mass transit; and 81 percent, area safety. Other reasons include access to parks and the waterfront; size of apartment; cost or affordability of apartment and local schools.

Other Findings:

Lower Manhattan is home to more couples and households with children than singles and roommates. About 23 percent of households Downtown have children under the age of 18.

The number of Lower Manhattan households with children likely will continue to rise as 40 percent of households without children responded that they were likely to have children in the next three years.

This trend remains strong compared to 2007 when 39 percent of those surveyed were likely to have children over the same time period.

Downtown residents work in a variety of industries. The FIRE sector (finance, insurance and real estate) was the top employer at 29 percent; creative services firms (including advertising, public relations, publishing, film, broadcasting, and arts) accounted for 14 percent of residents; and business services companies (legal and accounting firms) employed 14 percent.