The coronavirus pandemic has been raging for roughly a year now, devastating the small business community in its wake. In fact, it's estimated nearly 100,000 businesses across the country have closed permanently over the past 12 months.
Not surprisingly, many of New York City's small businesses have borne the brunt of the pandemic. Not only were many businesses forced to shutter temporarily when the outbreak began, but in the months since the pandemic started, there's been a mass exodus of city dwellers who have packed up their tiny apartments and moved out to the suburbs instead.
But that wave of city transplants may be helping suburban enterprises. And that's good not just for the people who own those businesses, but for real estate investors as well.
Suburban businesses get their turn to shine
These days, a large number of people are working from home rather than going into the office. And in the suburbs of New York City, that means a lot of people are spending more time than ever in their own communities.
In Westchester County, for example, about 40% of residents work outside the county itself, and of those, more than half work in Manhattan. But as of October, an estimated 90% of Manhattan office employees had not returned to their former buildings since the pandemic began, according to a survey by the Partnership for New York City.
This means a lot more people are suddenly staying put and not commuting. As such, they've been more apt to spend money at local businesses, from clothing stores to coffee shops to restaurants -- the money they formerly spent supporting a host of New York City establishments convenient to their offices.
It's this prolonged remote work trend that's helping suburban businesses thrive. And given that many companies are making plans to keep working remotely once the pandemic is over, it could mean a large number of these businesses will indeed maintain their staying power.
That's good news for real estate investors in several regards. First, a thriving small business community can lead to higher property values, so those with investment homes in New York City's suburbs may benefit in the form of commanding higher rents or selling their properties at a premium once they're ready to do so.
Secondly, an active small business community means commercial landlords can enjoy a steady stream of rental income. In an age when so many businesses are closing their doors, not having to grapple with a vacancy crisis is a lifeline for landlords right about now.
The Millionacres bottom line
Of course, some suburban businesses are still hurting. While it's true that fewer people are commuting into Manhattan and more are shopping locally, a lot of workers have also been hurt financially by the pandemic, and many are looking at less disposable income to spend. But still, the fact that a large chunk of suburban businesses are thriving should give real estate investors something to be happy about.