New York Marketplace Embraces Its Immigrant Past

https://www.nytimes.com/2019/04/02/business/new-york-marketplace-remembers-its-immigrant-past.html

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Michael Petrovitch is planning to sell Puerto Rican food at a new market on Manhattan’s Lower East Side close to where he was born, and he couldn’t be more excited.

Mr. Petrovitch has agreed to take 310 square feet of space at the Market Line, a marketplace of global foods that is expected to open in June as part of Essex Crossing, a $1.6 billion mixed-use development at Essex and Delancey Streets.

He and his daughter Lillian will be serving roast pork sandwiches, plantains and other Puerto Rican specialties alongside Chinese fishmongers, German sausage makers and other vendors that have been selected for the quality of their food and the size of their locally based businesses.

“When Market Line saw my request to be a vendor, they immediately jumped on board with me,” said Mr. Petrovitch, 54, who works in the music industry. “I’m opening up a business in the neighborhood where I have lived for 50-plus years, and I feel that I’m very lucky.”

Vendors like Mr. Petrovitch are essential to plans by the developer, Delancey Street Associates, to create a market populated by small, local businesses rather than chains or franchises. The project seeks to evoke the teeming environment of immigrants and pushcarts that characterized the Lower East Side starting in the 19th century.

“It’s really just an evolution,” said Rohan Mehra, principal of the Prusik Group, one of the partners on the project. “We’re not trying to do something new here, we’re just trying to reflect what has been, transitioning through history.”

At 1.65 million square feet, Essex Crossing is one of the largest developments in the city. After tenements on the site were razed in 1967, it sat empty for decades while city officials, community representatives, developers and lawmakers fought over its future.

In 2013, plans were finally announced for a development that would include a mix of commercial space, luxury condominiums and affordable housing. Other features include a senior center, a museum, a public park, a bowling alley and a multiplex.

Delancey Street Associates is an alliance that three builders — Taconic Investment Partners, L&M Development Partners and BFC Partners — formed to build the commercial and residential properties. Goldman Sachs and the Prusik Group are also partners in the Essex Crossing project.

Three months before the market’s planned opening, 25 of the 30 vendor slots in the first phase of a larger plan have been taken. Almost 80 percent are owned by women, minorities or first-generation immigrants, consistent with the developers’ aims.

The developers have attracted small businesses to the marketplace in part by providing services like trash collection, air-conditioning and shared bathrooms without charging separately for any of them, cutting tenants’ costs and allowing them to focus on their food and their customers.

The services have allowed entrepreneurs like Mr. Petrovitch to open a business in a city where start-up costs can be prohibitive.

Mr. Petrovitch said he could not have afforded to open a regular retail space in Manhattan. He briefly considered a site on Houston Street where he would have paid $150,000 upfront for a five-year lease, and would then have had to pay to renovate the space.

At the Market Line, he is paying for kitchen equipment, a city licensing fee and some aesthetic touches for his new space, but he will not have to worry about major construction like building walls or drop ceilings.

When the new businesses open, they will join 21 existing vendors from the adjacent Essex Street Market, a city-run site that was set up in 1940 by the administration of Mayor Fiorello LaGuardia to take pushcarts off the streets. The Essex Street vendors are expected to move to the ground floor of the new market site this spring, while the new businesses will occupy the lower level.

Megha Chopra, assistant vice president of New York’s Economic Development Corporation, predicted that the combined market would attract regular Essex Street customers as well as new shoppers and tourists drawn by the new businesses.

“We have our own customer base that was nurtured and cultivated over the years, and a lot of those people will still come to Essex,” Ms. Chopra said. “With this development, there will also be a lot of New York City tourists or international tourists. There will be this incremental customer base coming through the market.”

The first phase of the Market Line is nearly complete. In the next phase, the space will be extended beneath two new office buildings, and the full market is expected to open in late 2020.

When fully occupied, the market will have more than 140 vendors, including new and existing tenants. The completed market will be a 150,000-square-foot space below ground that will also include galleries, art shops and a beer hall.

A few floors above, construction is proceeding on office space that will total 350,000 square feet in the two buildings. The first is expected to be complete in the summer of 2020, and the second about six months later.

The Essex Crossing project will also include 1,079 apartments, of which 152 will be condominiums. Half of the rental units will be affordable.

Charles R. Bendit, a co-chief executive of Taconic Investment Partners, said the new offices would provide large open spaces — floor plates range from 35,000 square feet to 52,000 square feet — that are designed to facilitate collaboration in the workplace.

The offices will avoid the siloed approach to corporate space that characterized earlier generations. “Today, it’s a much more collaborative, social experience,” he said.

Mr. Bendit said he expected the office space to rent in the “high $90s” per square foot. And he predicted it would attract employers that want to hire young people looking to work in an environment with access to good transit service and closer links to the community rather than a more corporate location like Midtown Manhattan.

The integration of Essex Crossing with its neighborhood is consistent with the aims of the Essex Crossing Task Force, a panel of community board members, elected officials and former site tenants that was set up to guide the development after decades of disagreement over what to do with the empty site.

The task force wanted to protect current vendors in Essex Street Market while providing incubator space for new local businesses, said Gigi Li, a former chairwoman of the community board. It also blocked “big box” stores by denying any business that would take more than 30,000 square feet, she said.

“Because the scale of this development was so large, we didn’t want it to become a large retail corridor,” she said. “We wanted something that would fit the very residential nature of the neighborhood.”

Fernando Ruiz, a local entrepreneur, wanted to add a restaurant to his wholesale and retail operation, Tortilleria Nixtamal, which makes fresh tortillas in two locations in Corona, Queens. Expanding to the Market Line helped him meet that goal.

Mr. Ruiz said he could not have afforded to open his own store in Manhattan, but the assistance provided in the Market Line allowed him to do business there. He will be paying $12,000 a month for 600 square feet in the new space, which he hopes will become his flagship store.

His move is the result of the approach by Delancey Street Associates, which decided that his business would be a good fit for the new market.

“They said, ‘We want you to pick this up and move it to Manhattan,’” Mr. Ruiz said. “I’m really proud that they picked us.”