The economic profile of the Fashion Center Business Improvement District (BID) and the “Fashion Industry” is presented in our Year 2003 update. It is the eighth of our economic reports on the BID, and fully reflects the changes in the composition of the Fashion Center and its real estate. An update on the retail environment is also presented in this year’s report, including an analysis of the available retail potential and its probable impact on the ability to attract quality retailers to the area. This 2003 report is the first to track the impacts of a sluggish economy and the lingering impacts of September 11th which have altered the price structure and tenancy within the area.

The Fashion Center BID, established in October 1993, provides supplemental services, maintenance, and capital improvements in the area to a Midtown neighborhood known as the "Garment Center”. The success of the Fashion Center BID and its crews has dramatically improved security and cleanliness in the District.
The BID has also initiated a streetscape program, which furthers the goal of physical improvements to the neighborhood.

The Fashion Center BID, directed to promote business retention and to attract new business to the area, has initiated successful marketing tools, such as the Information Kiosk, and a web site www.fashioncenter.com. It also publishes a newsletter that assists out-of-town apparel buyers and promotes access to the wide variety of Fashion Center businesses. In addition, it has implemented an economic development program to assist local businesses. In this regard, it is necessary to measure the economic base of the BID area to give direction to the Fashion Center BID for the future economic development initiatives.

This update represents a continuation of various economic and real estate measurements gathered since 1994. It updates the base data regarding the overall business level of the "Fashion Industry", and its employment trends. It also updates our previous measures of real estate usage, rental rates, absorption and vacancy rates within the BID.

Additionally, the available data is measured against the probable impact of the Fashion Center BID within the overall structure of the "Fashion Industry" in New York City, as well as the BID's impact within the general economic trends and activity throughout Manhattan and the City.

The Fashion Center BID covers an irregularly shaped geographic area that ostensibly extends from 35th Street to 40th Street, just west of 5th Avenue to just east of 9th Avenue. Because of its irregular shape, portions of 35th Street and 40th Street are excluded, while portions of 41st Street and The Port Authority Bus Terminal, which extend to 42nd Street, are included. A map indicating the specific BID boundaries is presented.

The BID's irregular shape does not conveniently conform to existing governmental geographic designations such as: census blocks, census tracts, special zoning districts, or zip codes. Therefore, to measure some of the trends it was necessary to either enlarge or reduce the area slightly to conform to these established governmental boundaries. The changes are detailed in the appropriate sections of the report and may differ for each element of the analysis, but remain relatively consistent from year to year.

In our earlier assessments, certain assumptions had to be made in order to relate the different data sources and definitions to each other. The particular assumptions used throughout the analytical process are noted in the appropriate portions of the text. However, it is assumed throughout the report, that all information obtained either privately or publicly is sufficiently accurate for forecasting purposes, unless otherwise noted.

Additionally there a number of terms that are used in the retail market section of the report that may not be familiar to some readers. These terms are:

GAFO - This term refers to a combination of United States Department of Commerce categories for retail outlets comprised of General merchandise stores (including department stores), Apparel stores, Furniture and home furnishings stores, and the "Other" shopper goods retail stores.

Eating & Drinking - This term refers to the retail sales or retail potential for restaurants, cafes, coffee shops, taverns, and specialty take-out places. It does not include supermarkets or grocery stores.

Drug, Services & Convenience - These include establishments which serve the daily needs of their customers, such as drug, health & beauty aids, hardware stores, opticians, dry cleaners, newsstands, shoe repair and other personal service businesses.

Food at Home - This includes items bought in supermarkets, grocery stores, delicatessens, bodegas and such, primarily for consumption at home.

Per Capita Retail Expenditure - Represents that portion of an individualís total income, which is typically spent for consumer goods. It is categorized by store type.

Total Retail Potential - The total dollars available from trade area residents, employees, and visitors for various consumer goods by store type. More specifically, it is the multiplication of the population in each resident trade zone or market segment (i.e. employee and visitor) and their corresponding retail expenditures by store type. These dollars are available to all stores both within and beyond the trade area.

Untapped Retail Potential - Represents the remaining portion of the adjusted retail potential after an estimate of current sales by existing retailers is taken in account. In effect, it is the untapped or excess retail potential that is available to existing and prospective retailers.

SIC Codes - An acronym for “Standard Industrial Classification” reflects the industry classification that a business gives itself for the purposes of reporting governmental data. This system tabulated employment, payroll, number of establishments and other economic data based on the industry group that each business deemed itself to be in. All employees within the business were deemed to fall into that chosen classification. This methodology has since been discontinued.

NAICS Codes - An acronym for “North American Industrial Classification System” reflects changes made since NAFTA treaties were signed with Mexico and Canada. While businesses still give themselves a classification, all administrative, clerical and management functions within a business are tabulated separately. In areas such as manufacturing this has reduced the number of manufacturing employees to reflect only those in the production sector, as all accounting, administrative and clerical function are now reported separately.

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