Gramercy Park Block Association - Neighborhood News #567

Danny Meyer's Union Square Cafe Joins Other Victims of New York City's Rising Rents



Angelique Craney, a customer at Union Square Cafe for 26 years, with the bartender Audrius Grigaliunas on Monday. Credit: Karsten Moran for The New York Times

It is one of the hard truths of New York real estate: Restaurants help revitalize neighborhoods, then are forced to close when their rents skyrocket.


The latest casualty is Union Square Cafe, a pioneering restaurant that became the mother ship of the fleet run by the entrepreneur Danny Meyer. It will forfeit its lease at the end of next year, close its doors and move to a location to be determined. The East 16th Street space it has occupied for nearly 30 years will go on the market this week, brokers said.


Manhattan restaurateurs often lament that they face impossible odds in a real estate climate that increasingly puts them in competition for space with international retail chains, banks, pharmacies and other deep-pocketed businesses. If Mr. Meyer, a mogul with acclaimed and successful restaurants all over the world, can be compelled to close Union Square Cafe, they ask, what hope is there for the rest of them?


"There's no such thing as a New York restaurant that is immune to real estate," Mr. Meyer said in an interview.


Mr. Meyer cited an unbridgeable gap between what the landlord, Ari Ellis of David Ellis RE, believes he can get for the space, and what the restaurant can afford to spend on rent and renovations in order to maintain its high standards of cuisine and service. Both parties said the renegotiations of the 15-year lease, which began in early 2013, had been amicable but fruitless.