Dean Barber

The Center of the World

In Corporate Site Selection and Economic Development, Uncategorized on August 9, 2014 at 9:43 pm

NEW YORK – Even when I am on vacation, I cannot escape my role as a location investigator, a place sleuth. Delving into how and why a place works in the way it does is what I do as a consultant for both companies and economic development organizations.

A vacation, therefore, is never going to be a simple outing, and especially so when I am visiting what I believe is one of the most complex places in the world. Suddenly, I found myself on a mission, which is par for the course in New York, where everyone is on a mission of some sort.

As the most-populous city in the United States, with an estimated record high of 8,405,837 residents as of 2013, more people live here than in the next two most-populous U.S. cities (Los Angeles and Chicago) combined

Not surprisingly, this is a tough place. A crowded place. A noisy and chaotic place. An expensive place. A very diverse place. And in so many ways, New York is and remains, as filmmaker Ric Burns termed it in a 2001 documentary, the “Center of the World.”

I had been to New York on business before, but this was the first time that I was able to really explore it. My wife and I were there for a week.

The American Dream Lives

In front of the National Museum of the American Indian, formerly the Alexander Hamilton U.S. Custom House, I spoke to a man from Sierra Leone from the West Coast of Africa. He had been living in New York for the past 15 years. For him, this country and this city represented freedom and opportunity to build a purposeful life.

“There is no place better on Earth,” he said. “No place.”

In his eyes, the American Dream, which had nothing to do with home ownership or even building great wealth, was far from dead.

Today, about about 37 percent of the city’s population is foreign born, but no single country of origin dominates in that regard. The 10 largest sources of foreign-born individuals in the city as of 2011 were the Dominican Republic, China, Mexico, Guyana, Jamaica, Ecuador, Haiti, India, Russia, and Trinidad and Tobago. Based on the many languages that I heard uttered, I think ran across every one of these groups.

But that didn’t bother me in the least. No, I see our diversity as a continuing strength and in keeping with an American tradition of essentially creating and molding a group of new Americans to follow their dreams.

In his Letters from an American Farmer (1782), J. Hector St. John de Crevecoeur writes, in response to his own question, “What then is the American, this new man?” I think I met him in New York.

A Reminder of Who We Are

Yes, New York has its Wall Street, the financial district of the city and home to the New York Stock Exchange, the world’s largest stock exchange. But there is another story here, one I find just as compelling, of immigrants, reminding us just who we really are.

For we should never forget that New York was the first place where many of our ancestors first set foot on American soil. Some would eventually venture away from the city and settle into the interior. But New York was their starting point, their launching pad for a new life in a new country.

Christian Friedrich Martin is a prime example. He arrived with his family in New York in 1833 from Austria, eventually moving to Nazareth, Pa., where in 1839 he established a guitar making shop. Martin guitars are still made in Nazareth today. (At the Metropolitan Museum of Art, my wife and I happened upon an exhibition of mostly 19th century Martin guitars. As an owner of two Martins, I was just enthralled.)

But many of the newly arrived would stay in the city and find a neighborhood where they felt most comfortable around their fellow countrymen of origin. Said immigrant Patrick Murphy, “New York is a grand handsome city. But you would hardly know you had left Ireland.”

A decade later, many of Murphy’s compatriots would join the Union army after literally stepping off the boat. Lured at the prospect earning $13 a month, thousands would die in a strange land called Dixie. The 69th New York State Volunteers flew a green flag with a golden harp on it, symbolizing Ireland.

The Great Shifting

During our many travails around the city – by foot, cab, bus and subway — the ethnicity of neighborhoods was still apparent – Little Italy, now a tiny fragment of what it once was; Chinatown, home to the largest enclave of Chinese people in the Western Hemisphere; a Greek enclave in Astoria in Queens, and an ultra-orthodox Satmar Jewish community in Williamsburg in Brooklyn.

Many if not most of these neighborhoods are losing their ethnic identities with gentrification, which translates into he or she with the most bucks takes home the marbles.

This shift toward wealthier residents and/or businesses and increasing property values is one of the bigger stories that I picked up during our week-long stay in New York.

Gentrification happens with increased investment in a community by real estate developers and local government, thereby spurring more business growth and lower crime rates. This is generally a good thing.

But gentrification also leads to poorer residents being displaced by wealthier newcomers, thereby changing the character of the neighborhood. Gentrification “has become shorthand for an urban neighborhood where muggings are down and espresso is roasted,” wrote New York Times reporter Andrea Elliot.

Harlem would be an example. New York’s most iconic black neighborhood, no longer has a stigma urban decay, is experiencing another rebirth, reflected in new restaurant hot spots like Red Rooster Harlem and The Cecil, where we had our best meals.

Census data maps show significant drops in the African-American population in Harlem, largely because long-time residents are being priced out of the neighborhood. Between 2010 and 2011, the median housing prices in central Harlem jumped by over 18 percent, the Times reported.

But gentrification has been happening all over the city, making the once affordable neighborhoods, like the Meatpacking District, Greenwich Village, Soho, not longer affordable except to the wealthy.

Rent City

According to census data prepared by the sociology department at Queens College, there are about 582,000 rentals in Manhattan, as opposed to 165,000 owned units, meaning rentals make up 78 percent of the total.

New rental projects coming onto the market are rare. Land costs have skyrocketed in the last few years, to the point that prime Manhattan sites can go for $850 a square foot.

With rents of $3,000 a month typical for a one-bedroom apartment, recouping an investment could take years. For most real estate developers, building pricey condos and selling them for a hefty $3,000 a square foot is the better bet.

But despite the high cost of living, immigrants from all over the world continue to flock to New York, with the Bronx probably the most affordable of the five boroughs. But even there, where graffiti adorns many buildings, high rents have some locals packing up and leaving.

Rich and the Richer

As a global hub of international business and commerce, it should be of no surprise that New York has the highest density of millionaires per capita among major U.S. cities in 2014, at 4.6 percent of residents. It is also home to the highest number of the world’s billionaires, higher than the next five U.S. cities combined.

The city is a major center for banking and finance, retail, world trade, transportation, tourism, real estate, media, advertising, legal services, accountancy, insurance, theater, fashion, the arts, you name it and it’s probably here.

And while economists talk of the demise of manufacturing in the city, there are companies who are engaged in manufacturing, driven by technological advances that shrink the size of manufacturing equipment. Indeed, about 14,000 residents of the Bronx are employed in manufacturing.

Silicon Alley

Home to hundreds of tech startups, the tech sector continues to expand in Manhattan and Brooklyn. I stood on the sidewalk outside Chelsea Market, gawking at 111 Eighth Ave., Google’s New York City headquarters, wondering what the heck was going on inside there. Nobody came outside to tell me.

Google bought 111 Eighth Ave., a 3 million-square-foot office building, just more than two years ago, paying almost $2 billion.

Since the recession ended five years ago, New York has added more tech jobs than any city with the exception of San Francisco. The tech sector is now a major part of New York’s economy–by some counts the amount of venture, angel, and private equity cash poured into New York has grown from $799 million in 2009 to about $3 billion in 2013.

In the last four years, the city added 25,000 tech jobs — up 33 percent. The sector, responsible directly or indirectly for 291,000 jobs, is now 7 percent of the city job market, behind health care at 16 percent and retail at 8 percent.

Lunch Atop a Skyscraper

A favorite photograph, one that I never tire looking at, is Lunch Atop a Skyscraper (New York Construction Workers Lunching on a Crossbeam). You have probably seen this black-and-white photograph, which depicts 11 dusty construction workers, mostly immigrants, eating sandwiches and smoking cigarettes, as they casually sit nonchalantly on a crossbeam 840 feet above New York City streets.

The photo was taken on September 20, 1932, during the height of the Great Depression, on the 69th floor of the RCA Building, now called the GE Building. According to archivists, the photo was staged to promote the opening of the skyscraper, but nevertheless those were real ironworkers who were part of the construction project.

There is something about that photograph that harkens the American experience. And while they are white men, of European extraction, a similar photograph could be taken today of men and women at work of different races from other parts of the world who are here because they believe in America and the opportunities that they see here.

I wonder sometimes if we can see what they can see. New York, despite all its foibles, continues to say, “Yes, you can,” probably more so than any place in America. And for that we should be thankful.

Sociologists now largely disregard the term “melting pot,” as being outdated and inaccurate. I don’t have the academic background to argue with them, but I would think that immigrants and their descendants would want to adapt and assimilate to their new surroundings in order to prosper.

In his 1905 travel narrative The American Scene, Henry James writes about cultural intermixing in New York City as a “fusion, as of elements in solution in a vast hot pot.”

My hope is that the pot stays hot, thereby keeping New York as the Center of the World.

I’ll see you down the road.

Dean Barber is the president/CEO of Barber Business Advisors, LLC, a site selection and economic development consulting firm based in Plano, Texas. If your company needs an optimal location for future operations anywhere in North America, we can help. If your community needs to improve its competitive standing, we can help. All requests for information are considered confidential.

If you liked what you saw here, invite me to speak at your next meeting.

© Unauthorized use of this blog is strictly prohibited. Excerpts and links may be used, but only if expressed permission has been granted.

  1. Being from Northeastern Mexico, perhaps my temperament is closer to Texas than NY or California, yet you struck some points that fuel my optimism for the United States and the ideas that define the nation. It also brought to mind an Ayn Rand quote that I fully absorbed on my first visit there, a few months after 9/11:
    “I would give the greatest sunset in the world for one sight of New York’s skyline. Particularly when one can’t see the details. Just the shapes. The shapes and the thought that made them. The sky over New York and the will of man made visible. … Is it beauty and genius they want to see? Do they seek a sense of the sublime? Let them come to New York, stand on the shore of the Hudson, look and kneel. When I see the city from my window – no, I don’t feel how small I am – but I feel that if a war came to threaten this, I would throw myself into space, over the city, and protect these buildings with my body.”

  2. Just before reading your blog, I saw a Facebook post with a map of the U.S. that showed, by state, the most common language spoken in each state, after English and Spanish. In Minnesota? The third most common language is Hmong, due to religious institutions who supported southeast Asian refugees to relocate here after the Vietnam war. Today, there is a new influx of immigrants from east Africa, who have faced their own disastrous conflicts. The Somalian and other east African workers – like the southeast Asians before them – bring a surprising new life and diversity and energy to a place like Minnesota where most wouldn’t expect it. The forces you describe that built New York, and America, are alive today and I think for the good.

  3. Beautifully done, Dean. My only regret is that you didn’t look me up while you were here. But you caught both the historical and present essence of the city extremely well. As someone who has lived and worked in New York for more than 35 years, I realize it’s often regarded as the most “foreign” of U.S. cities. And there is certainly a lot of international influence — and billions in foreign money — here, in fact more than ever. But it’s also arguably the most quintessentially America city, and you’ve captured that perfectly.

    P.S. for your readers who haven’t had the pleasure of seeing the Ric Burns series, here’s a bit about it. Well worth renting (or buying!):

  4. As the ultimate hick from the ultimate sticks, it seems strange that I would have such an affinity for New York City. But your post gels a lot of the reasons I love the place. I’ve only been there once, but loved every minute of it, including being tailed by an unbalanced man through Times Square and into the Carnegie Deli. My son just returned from the City, after a job prospecting trip with his university pals, and is planning to return there soon. If he ends up working there, it will give me a great excuse to visit much more often. I appreciate your perspective on the great “melting pot” (even if that term has fallen out of favor) that is New York City and the United States. Many of my ancestors came through Ellis Island and New York City on their way to the various spots in Idaho where my genes were cultivated. Thanks!

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