The future of city business districts in an Internet age?

The Atlantic has some ideas.

These days, walking through parts of Manhattan feels like occupying two worlds at the same time. In a theoretical universe, you are standing in the nation’s capital of business, commerce, and culture. In the physical universe, the stores are closed, the lights are off, and the windows are plastered with for-lease signs ... A rich ghost town sounds like a capitalist paradox. So what the heck is going on?

. . .

There are at least three interlinked causes. First, the rent, as you may have heard, is too damn high ... commercial rents have ascended to an altitude where small businesses cannot breathe. Some of the city’s richest zip codes have become victims of their own affluence.

Second, the pain of soaring rents is exacerbated by the growth of online shopping ... it is no coincidence that New York storefront vacancy is climbing just as warehousing vacancy in the U.S. has officially reached an all-century low: A lot of goods are moving from storefronts to warehouses, where they are placed in little brown boxes rather than big brown bags ... Online shopping has digitized a particular kind of business—mostly durable, nonperishable, and tradable goods—that one used to seek out in department stores or similar establishments. Their disappearance has opened up huge swaths of real estate.

. . .

[Third,] Many landlords don’t want to offer short-term leases to pop-up stores if they think a richer, longer-term deal is forthcoming from a national brand with money to burn, like a bank branch or retail chain. The upshot is a stubborn market imbalance: The fastest-growing online retailers are looking to experiment with short-term leases, but the landlords are holding out for long-term tenants.

New York’s problems today are an omen for the future of cities. Most people don’t live downtown because they love drifting off to the endearing sounds of honking cars and hollering investment bankers. Rather, they want access to urban activity, diversity, and charm—the quirky bars, the curious antique shops, the family restaurant that’s been there for generations—and the best way to buy that access is to own a bedroom in the heart of the city.

What happens when cities become too expensive to afford any semblance of that boisterous diversity? ... what’s the point of paying New York prices to live in a neighborhood that’s just biding its time to become “everywhere else”?

There's more at the link. Thought-provoking and recommended reading.

The author raises a very important point.  There are more than a few cities, particularly in the so-called "rust belt", where the local economy has been in the doldrums for years, thanks to the decline in US industrial production.  One can buy a very nice three- or four-bedroom house in such cities for well below $50,000 - ten to twenty times less than many currently-booming major cities.  I know some people who have deliberately chosen to move to such locations, because their money goes so much further there.  They live in nicer houses, can buy goods and services more cheaply, and send their children to better, less burdened local schools (often private schools).  The Internet means they can work from home, or at least run a small business with access to major markets without actually having to live in or near those markets.  That's been a life-changer for them.

Of course, this also begs the question of the reliability and sustainability of the Internet as a primary backbone of commerce and industry.  If anything - weather, natural disaster, war, hacking, whatever - takes down the Internet for an extended period, or even limits access to it, those relying on it to earn their daily bread will be in for a nasty time.  Being among them now, as a writer who self-publishes some of his work, I can't help but think about that from time to time.  There's nothing I can do about it, but it's still something to keep in mind, and against which to have contingency plans, if possible.

Peter