NYC's Retail Apocalypse: Why Empty Pharmacies Are a Big Problem

The Rise of 'Zombie Pharmacies' in NYC

New York City is facing a unique retail crisis: a staggering number of vacant chain drugstores are sitting empty, creating a blight on the cityscape. These empty spaces, often spanning thousands of square feet, are a stark contrast to the bustling retail recovery happening elsewhere in the city.

Why Are Pharmacies Closing?

• Lower Reimbursements: Pharmacies are receiving less money from insurance companies for drug sales, a major source of revenue.
• Online Shopping: The rise of online retailers has cut into sales of convenience items like toiletries.
• Ironclad Leases: Many pharmacies are locked into long-term leases at high rents, making it unprofitable for them to operate, even if they are paying rent on empty stores.

The Impact of 'Dark Rent'

This phenomenon, known as 'dark rent,' creates a major obstacle to revitalizing these empty spaces. Landlords have little incentive to find new tenants when they are already receiving rent from the pharmacy company. This leaves prime real estate gathering dust and becoming potential eyesores, attracting crime and negatively impacting nearby businesses.

Seeking Solutions

New York City officials and business groups are exploring ways to repurpose these vacant spaces. Zoning changes have introduced new possibilities, allowing for conversions into things like:

• Microbreweries
• Arcades
• Children's Play Centers
• Laser Tag Venues
• Ax-Throwing Bars
• Light Manufacturing (beer brewing, coffee roasting, 3D printing)

However, the prevalence of long-term leases continues to be a significant barrier. While some spaces have been filled with grocery stores, convenience stores, and even new pharmacies, many remain empty, and the 'smallest Band-Aid imaginable' – seasonal pop-up shops like Spirit Halloween – aren't enough to address the problem.

Image:

Empty shelves in a shuttered pharmacy in Queens. Chain pharmacies often stay closed long after they have stopped operating, because the company is stuck in a long-term lease.