The sky’s the limit

In 1977, Liza Minnelli popularized the song “New York, New York,” written by Broadway composers John Kander and Fred Ebb. Few songs have captured the spirit of the city the way that classic has. “If I can make it here, I’ll make it anywhere,” Minnelli, and later Frank Sinatra, roared in the song’s famous refrain. New York has always been a city of dreams, of reaching for the sky. Even the state seal, adopted in 1778, bears the Latin word excelsior, which means “ever upward.”

The idea of making it in New York City as an absolute measure of success is not limited to song. It’s a very real standard for almost all business ventures here. For more than 200 years, since the founding of the US, New York has been a global leader in invention, commerce, entertainment, publishing, and economic development. The Empire State Building gets its name from New York State’s nickname, because industrial empires are indeed built here.

In my experience of living in both New York and in Germany, one of the guiding principles behind every successful business in New York is attitude. If you have a great idea, can finance it, and have the will to realize it, grab the chance. New York offers enormous growth potential. Compared to Germany, there’s less regulation and there are greater tax incentives. The free market is freer, making it easier for start-ups. Rent a space, pay a couple of bucks to register your business, and get to work. Because New York is the most multicultural city on the planet, it’s often easier to find a market niche.

A German entrepreneur in New York once told me, “No one gets really rich in Germany. If you want to make real money, you have to come here.”

But beware, just because some of the bureaucracy is more relaxed doesn’t mean doing business with New Yorkers necessarily is. We may be less formal than Europeans, but this doesn’t mean that we’re relaxed. For New Yorkers, time really is money. There’s enormous pressure to perform, and people are generally very stressed out.

One reason is the cost of living and office space. Rents in the city are exorbitant. Most small businesses struggle to cover their costs. Today, many stores along the avenues stand empty as a result of rising rents. While German cities like Berlin and Munich are booming and building, Manhattan’s avenues are beginning to look eerily deserted. “FOR RENT” and “TO LET” signs can be seen everywhere.

The most noticeable development in the city now is Billionaires’ Row on 57th Street. Towers high enough to challenge airplane flight patterns are rising, with apartments selling for hundreds of millions — astronomical sums. (I’m reminded of the state motto, although I don’t think New York’s founders had rent in mind when they chose excelsior.) Meanwhile, commerce on the avenues is suffering.

The most noteworthy items of local business news of the past year reflect this trend. Online giants such as Amazon or Google and what we call “big box stores” — large, inexpensive chain retailers such as Walmart, Home Depot, or Costco — are the only businesses that can afford the rising prices. Last year, however, New Yorkers did manage to keep Amazon from opening it’s HQ2, its second headquarters, in Queens, which would have cost the city’s taxpayers billions, and crowded the subways and raised local rents even more. In this case, we won the battle, but we are still losing the war.

Not even expensive stores can afford the rent. The high-end New York department store chain Barneys filed for bankruptcy last year after the rent for its flagship store on Madison Avenue doubled to $30 million per year. At Christmas, the luxurious store was filled with big red “SALE %” signs and with people who normally could never afford to shop there. It looked more like a Woolworth’s than a fancy department store for the rich and famous. It’s no wonder that one of the longest-running Broadway musicals in history — about the struggles of life in New York — was called “RENT.”

Recently, the New York Post published results of a poll in which New Yorkers were voted “the unfriendliest Americans” by other Americans. When doing business with New Yorkers — whether you’re a partner, an investor, or a tourist out shopping — out­siders have to understand that New Yorkers want things now, or, better still, yesterday. Efficiency, convenience, turnover, and service are what counts. So, if you’re doing business with us, please remember we really are all just trying to make it here, like the song says, and we are all trying to pay for a roof over our heads.