Mom and pop bakeries in Hell's Kitchen are at an ironic crossroads ? the very gentrification that might send them new customers may also price them out of the neighborhood.
Folding phyllo dough at lighting speed, Lili Fable moves the tray of spanakopitas, a Greek spinach pastry, that is waiting to go into the oven. She's been a baker at Hell's Kitchen's Poseidon Bakery on 44th Street and 9th Avenue for over 30 years, since she joined her husband's family business as a newlywed. She removes a tray from the oven, replacing it with the new batch, glancing up for just a moment at the photographs of her children and grandchildren that paper the walls of what is a mom and pop shop in its truest sense.
Fable claims that Poseidon is the only Greek bakery left in Manhattan, with Astoria the new center of this ethnic specialty. That, coupled with the fact that everything in the shop is handmade, "the way it was done 400 years ago," according to Fable, is the basis of Poseidon's lasting appeal.
While tradition and hard work help keep Poseidon's Bakery in Hell's Kitchen, a neighborhood facing a new tide of gentrification, they, like other mom and pop bakeries around, are scrambling to survive at an ironic crossroads ? the very gentrification that might send them new customers may also price them out of doing business in the neighborhood. Delicious baked goods aren't enough to stem the tide of gentrification. An owner needs an insurance policy in addition to their baked goods, such as property ownership, a long lease, or an internal profit-center, to stay afloat.
For years, zoning regulations kept Hell's Kitchen a mostly industrial area with a mix of bars, clubs, and storage facilities. The regulations, however, were relaxed in the City's post 9/11 era, which led to a new era of residential developments. Since then, according to a new report by the MNS real estate firm, gentrification has increased, and with it the cost of residential real estate in Hell's Kitchen, up more than 15 percent this quarter.
That, along with the construction of Hudson Yards and the 7 train expansion, makes it clear to real estate agents at Cooper and Cooper that prices will continue to climb, both for residential and commercial properties. "One thing affects the other," explained Eirik Gislason, vice president and manager at Cooper and Cooper. "It's a domino effect," Gislason said. "If residential prices go up, commercial prices will go up as well."
"This is not the 9th avenue of old," laughed Fable, nostalgically.
Edie Connolly, who owns and operates Cakes 'N Shapes at 51st Street and 10th Avenue, has been in her current location for the past seven years. Because of her 10-year lease, she pays under $10,000 a month in rent, because, she says, her landlords, Clinton Housing Development Center, "really wanted me here." Connolly is not the only mom and pop bakery with a deal with Clinton Housing Development Group. Cupcake Café on 9th Avenue between 40th and 41st Streets also has a rent deal with the private group, which aims, among other efforts, to stabilize and preserve small businesses in the neighborhood.
Connolly is nervous, however, about what will happen when her lease is up in three years: "That's the story in New York though-commercial real estate, they'll mess around with you and increase rents because of how the character of neighborhoods are changing." Although she will still have the support from Clinton Housing, she will still be forced to either negotiate a new lease or find a new space.
Many bakeries in the neighborhood have already relocated or gone out of business. As she prepared baklava in front of well-kept antique baking ovens, Fable recalled, "We used to have two French bakeries, but they aren't here anymore." Italian bakeries no longer exist in the neighborhood either-"if you want Italian, head to Little Italy or cross town," she said with a sigh. "We've seen many many changes in this neighborhood."
Another local bakery owner, Darren Greenblatt of Donna Belle's Bake Shoppe, agrees. Although Donna Belle's at 49th Street and 8th Avenue has seven years left on its ten year lease, rent is still a significant expense. "It doesn't hurt that our business partner is a famous celebrity," said Greenblatt. Pauley Perrette, known for her role as Abby on CBS' NCIS, helps to draw customers to the shop. "She can tweet to a million people and tell them to come. We have her fans come in on a daily basis."
The profit margin on pastries is a complicated business. Connolly of Cakes 'N Shapes explained her cost breakdown: "The way I came up with my pricing was I had to put a dollar sign on my time and try to reduce costs as much as possible by buying in quantities. At the beginning I said I wanted to make $20 an hour." Factoring that in with her rent, which increases $50 a month for every month of her lease with no cap, she had to increase prices earlier this year to keep pace. During the recession, Connolly didn't adjust prices, although her rent continued increasing: "When the economy was bad, I ate that loss," she admitted.
Fable, a woman who knows her recipes in handfuls and sprinkles, takes a more old-world approach to her pricing. "We haven't changed our prices much since I've been here," she said. "For the families who keep coming." When asked about the profit markup per product, Fable waved her hand aside, smiled, and said, "we've never figured that out and I'm not about to now."
MUST READ NEWS
Sign up to get our newsletter emailed to you every week!
- Enter your email address in the box below.
- Select the newsletters you would like to subscribe to.
- Click the 'SUBSCRIBE' button.