From accountants and brokers to architects and artists, a more diverse group of tenants now resides in the Fashion District, occupying space made available by the continued decline of the local apparel industry. This decline, while ongoing in all sectors of the industry, has been most pronounced in the manufacturing sector, which had historically occupied side street space within the Special Garment District Preservation Area. With no new manufacturing tenants to fill the vacancies created by this decline, many fashion showroom tenants have migrated from the avenues to the side streets, and more general business tenants have moved into the avenue buildings.
Since the Fashion District is no longer dominated by a single industry, the FCBID’S economic development initiatives have been redesigned to have a broader application.

ECONOMIC PROFILE
Every year, the FCBID conducts a study of economic indicators in the district, including such categories as employment, real estate, economic impact and retail. Tracking this information, which the BID has done since 1994, enables us to assess trends which influence the development and prioritizing of our programs.

Compilation of the Economic Profile, which is produced by real estate and planning consultant Robert Pauls, was difficult this year. Government reporting of official data, already slowed by budget cuts in recent years, was further delayed by the events of September 11th. The full measure of the economic activity in the Fashion District will not be known until at least Summer 2002, when an update of the report will be published.

Generally speaking, however, we know that the “dot com” industry bust has affected the overall vacancy rate in the district and the asking rent prices. The availability of avenue buildings has risen from the extremely low figure of 6.6% last year to the current 13.1%. In side street buildings, the availability rose from 9.7% to 15%, contributing to an overall district vacancy of 13.8%. Rents have
ikewise softened considerably overall, although some properties are still negotiating from the high levels received in recent years.

While the immediate impact of the World Trade Center destruction brought a few dislocated downtown businesses into the area, the overall impact of that disaster has also been negative. Occurring, in effect, as an overlay on a general economic slump, the immediate halt of economic activity in the aftermath of September 11th created a significant change in consumer spending patterns that has been slow to rebound. This, in turn, affected many of our district’s wholesale businesses.

On a positive note, the district’s retail market continues to strengthen. Despite the various factors leading to the overall economic downturn, ground floor vacancy rates have remained steady at 12.5%, rents have remained quite strong, and some previously non-retail ground floor spaces have become retail establishments. Despite these positive indicators in the retail sector, our locally and nationally weakened economy, the soft Manhattan real estate market, and the impact of the events of September 11th make it difficult to ascertain the significance of the district’s current economic figures.

ABOVE A MORE DIVERSE TENANT BASE HAS BROUGHT ADDITIONAL ACTIVITY IN TO THE DISTRICT.

How the district performs in this next period of recovery will provide a clearer indication of the direction in which the district is heading.

SPECIAL GARMENT DISTRICT ZONING
In 1986, the Special Garment District zoning legislation was enacted, restricting the majority of Fashion District side street space to manufacturing uses. With the apparel industry in a decades long decline, there are far fewer manufacturing tenants to occupy these side street spaces, and the special zoning has become quite controversial.

The FCBID has distributed a Request For Proposals for a study, which will be conducted in the coming year. Its purpose will be to assemble a detailed, objective study of the impact of the zoning and the role of the apparel industry in the district. This important issue is covered in more detail in the section on Strategic Planning.

TENANT SURVEY
To keep our database of district businesses current, the FCBID conducts an
annual door-to-door survey of tenants. The 2001 survey was distributed to over 6,200 businesses, including nearly 900 ground floor establishments. The FCBID spends a great deal of time updating and maintaining its tenant database, not only to help promote our local businesses to potential customers, but also to keep tenants informed of our programs, events, and other items of interest.

BUSINESS DEVELOPMENT SEMINARS
In a district where over 85% of the commercial tenants can be characterized as “small businesses,” the FCBID recognizes the importance of helping companies increase their commercial competitiveness. Toward this end, we regularly conduct, or partner in, a variety of business seminars and programs. Last year’s business development events included:

Designers Forum
In June, the FCBID hosted guest speakers Kara Topjian and Michael Goldman of Showroomaccess.com, who met with over 25 new and emerging designers to discuss marketing through the internet.
E-Commerce Courses
Working with the Fashion Institute of Technology, the FCBID co-sponsored a number of seminars and classes structured to provide any type of small business with the basics of e-commerce:
• The eFuture and You, a three-day intensive course on new media and eCommerce.
• The Internet and Your Business, 18 weeks of classes on how to make businesses more efficient, productive and accessible to customers; offered twice.
• The Practical Internet, a full-day panel presentation to help businesses grasp the basics of utilizing the internet for business.

LEFT THE FASHION DISTRICT'S HEALTHY RESTAURANT AND RETAIL SECTOR BENEFITS FROM OUR DIVERSE TENTANT POPULATION AND HIGH PEDESTRIAN ACTIVITY.

NEW YORK FASHION
INTERNATIONAL
The FCBID continued its affiliation with the New York Fashion International (NYFI) program, which was initiated in 1997. Partnering with the Garment Industry Development Corporation and the U.S. Department of Commerce, the FCBID promotes the New York market overseas, aids
foreign buyers visiting here, and assists local fashion companies in learning to export. As part of this effort, NYFI is developing an on-line, virtual showroom. The site, which will debut in 2002, will exhibit apparel companies according to product category and will feature photographs and contact information from participating designers.

OWNER & TENANT SATISFACTION SURVEY
This year, as part of our contract renewal process with the City, the FCBID is also conducting a satisfaction survey by mail. This survey will not only assist us in reviewing the delivery of our services, but also will help determine priorities for future programming. The input and participation of our constituency remains a crucial part of our ability to deliver effective and meaningful services.

DISASTER ASSISTANCE
After the September 11th attacks on the World Trade Center, the FCBID met with fashion industry organizations to discuss ways to help companies adversely affected by the disaster and the ensuing long and short-term economic repercussions. Information on various assistance programs was compiled and faxed to all district tenants, fashion and non-fashion. For more information on these and other post-September 11th efforts, please see the section on our Response to 9/11