The biggest reason for the economic collapse in Manhattan could also be the reason for its recovery, rent prices. (WSJ)
At the start of the pandemic, sky-high residential and commercial real-estate values had made Manhattan unaffordable for many. Three decades of rising prices for nearly every type of property had made the borough largely a place where big companies operated and wealthy people lived…After a year of economic shutdowns and other changes brought on by Covid-19, rents for Manhattan storefronts, apartments and workspaces have been marked down to their lowest prices in years. That is already bringing in new small businesses and residents, and has the potential to change the character of the city’s most-exclusive borough.
This reminds me of a piece Derek Thomspon wrote last year that pretty much predicted this very thing. (The Atlantic)
If cities become less desirable in the next few years, they will also become cheaper to live in. In time, more affordable rents could attract more interesting people, ideas, and companies. This may be the cyclical legacy of the coronavirus: suffering, tragedy, and then rebirth. The pandemic will reset our urban equilibrium and, just maybe, create a more robust and resilient American city for the 21st century.
COVID has helped to bring wealth to more rural and southern areas. It has also helped to make cities more affordable. As horrible as COVID there is some good that can come of it. As Thompson writes, “From the ashes, something new will grow, and something better, too, if we build it right.”