NEW YORK -- Local bon vivants will soon have one more choice for their cuisine-cruising excursions. Trader Joe's is moving into Union Square, likely adding more fuel to the neighborhood's growing reputation as a foodie destination.
The new Trader Joe's is tentatively set to open in November, said Sal Ferrigno, managing director of Robert K. Futterman & Associates, who represented Trader Joe's in the 14th Street location lease. The store is the first Trader Joe's in New York City and will be located in a 15,000-square-foot space beneath New York University's Palladium dormitory complex.
Union Square is already home to Whole Foods Market, Garden of Eden Gourmet Market, The Food Emporium and other specialty food stores, as well as several of the city's most popular restaurants.
"We've kind of branded ourselves as 'Manhattan's Best-Tasting Neighborhood,"' said Henry Choi, director of public affairs for the Union Square Partnership, an organization comprising local business leaders, residents, not-for-profits and other groups seeking to improve the neighborhood. "We're thinking that Trader Joe's, when they open up, will just grow our stature as a nexus for food, foodies and cuisine and for getting your basic ingredients for a meal."
The neighborhood, however, wasn't always a gourmet hot spot. It certainly wasn't flourishing when the area's farmers' market, called Greenmarket, first began 30 years ago, said Gabrielle Langholtz, Greenmarket's publicity manager. The Council on the Environment of New York City, a privately funded citizens' organization in the Office of the Mayor, runs the Greenmarket and 46 other farmers' markets in the city and its boroughs.
''At the time that we opened, Union Square was known as Needle Park," Langholtz said. "There was the occasional dead body in Union Square, and you wouldn't ever go into Union Square because people were doing heroin. It wasn't such prime real estate."
The Union Square Partnership began in 1984 to speed the economic growth of the neighborhood.
And grow it did. Union Square, with its trendy restaurants, bars and markets, now has 1.1 million pedestrians traversing the area each week, according to a report on pedestrian traffic in the Union Square District issued by the Union Square Partnership. More than 73,000 people live within a half-mile of Union Square, and the area's median household income is 91% above the citywide average.
According to a market profile report issued by Robert K. Futterman & Associates, the median per capita income of $88,652 in 2004 should increase to $136,384 by 2009, when the average household income is predicted to reach $239,345.
MAKING A DIFFERENCE
The neighborhood is seeking to differentiate itself from other areas in the city to attract more residents and tourists, Choi said, and that's where supermarkets come in.
"What happens is, when you create a cluster [of food outlets] like this, it generates more interest," Choi said. "People understand that Union Square, in their minds, equals good food, so they are more apt to come down here to shop, knowing that there are many more outlets that they can go to."
A quarter of a million people now visit the Greenmarket each week, and Whole Foods, which opened here in March, is already attracting 100,000 customers weekly, Choi said.
Trader Joe's chose the area because it likes to locate near stores that already draw people who like different types of foods, Ferrigno said, noting several competitors who joined the area recently, including Whole Foods and Balducci's, which is planning to open a few blocks west on 14th Street.
Trader Joe's also got a favorable price on the space. The retail chain was looking to rent for approximately $70 per square foot, and though Ferrigno would not disclose the price Trader Joe's paid for its 15,000-square-foot space, he said it was a relative bargain. "Supermarkets don't usually pay a lot of rent, and the Union Square area is probably $200 to $300 per square foot in market -- they did pretty well," he said.
Even with a good deal on the lease, some may wonder if it was a gamble for Trader Joe's to move into a neighborhood already well-equipped with specialty food stores.
"There's far from a saturation in the island of Manhattan," said Matt Casey, owner of Clark, N.J.-based Matthew P. Casey & Associates, a grocery market and real estate research firm. "Trader Joe's will go in there, and they will do big dollars, and it probably won't impact any of the competitors at all. There's just so many people, both residential as well as daytime population, in New York City that they are just going to do extremely well."
In Union Square, each retail food outlet seems to fill a niche the others do not.
"In a way, the niches are complementary," Langholtz said. "People who want to buy fresh, local food, from the farmer who grew it, in a social setting, under the sky and with their dog -- all these wonderful farmers' market experiences -- they're going to go to Whole Foods afterwards and buy their lemons and olive oil and coffee, chocolate and magazines and toilet paper and recycled foil."
Likewise, Trader Joe's is particularly strong in its unique dry grocery goods and beer and wine selections, but they don't typically have strong meat and produce departments, Casey said. "It's supply and demand. The bottom line here is you've got incredible density, and [the stores] only need to capture a very small share of the market to produce a high-volume store. Between the residential and the daytime population in that area, it's got to be an incredibly high number."
Farmers at the Greenmarket, however, are divided over whether the new supermarkets and specialty food stores have hurt their businesses.
"I don't know what type of impact it has on our sales because we don't track them," Langholtz said. "The likelihood that it has no impact at all on us, not even a penny -- that's a pretty low likelihood."
Some farmers said sales were down, some said they were higher, and some said they were the same as last year.
Under a tent that shades him from the afternoon sun, Ed Benson stands behind a wooden cash drawer, chatting with a customer. Benson, who works at the stand for Race Farm in Blairstown, N.J., said the farm has been at the farmers' markets for 15 years. The fruits, vegetables, perennials and annuals piled under the tent are grown in six greenhouses and on 100 cultivated acres that make up the entire farm, which was established in 1938.
"Business is down a little bit this year," Benson said. "It was last year, too. We expect that to continue this year." Though business is down, the farmers' market offers something a supermarket cannot, Benson said. "I think it's the quality of what we sell."
Elly Hushour, owner of Patches of Star Dairy in Nazareth, Pa., said that though she hasn't noticed business getting slower as a result of Whole Foods opening, she knows they sell chevre as she does.
"My prices are comparable, but mine is fresher," Hushour said. The lamb she sells is also fresher and younger than what the stores carry, she added.
Langholtz said it is that freshness that distinguishes the Greenmarket from the other food retailers, allowing them to coexist.
"Now my corner deli sells Belgian endive and tomatoes on the vine flown in from Holland and shiitake mushrooms," she said. Competition is a lot tougher, and the Greenmarket farmers have responded by focusing on the freshness they can offer. "You can't get strawberries from California to a New York customer in less than four or five days."
This competition is what makes the neighborhood successful and is what will spur the creation of services better directed at the market, Choi said. "Union Square has shown, from the Greenmarket to all the restaurants and now to the interest of various boutique and niche specialty stores, that there is a huge demand for their wares and a huge demand here for all aspects of food shopping. I think the future is very bright for our district, and it should be taken advantage of."