Flushing’s Small Businesses Struggle Amid New Immigration Influx From China
Newly arrived merchants like the ease of starting businesses, but they are concerned about competition and rising rents.
By Muyao Shen
There are two types of businesses in the Sweet Season Shopping Mall, about 300 feet from the Main Street subway station in downtown Flushing.
One kind has existed more than a decade, and the other opened much more recently.
Fine Gift Shop is the first kind. On a recent day, owner Mita Teng, who moved from Fujian, China, more than 10 years ago, was talking to a customer in fluent English. “They sell this pair [of earrings] for $140 in Manhattan. That’s the Manhattan money. I can give you for only $48.” Having run her business for more than 13 years, Teng knew how to close a sale.
The customer, who was originally from South Korea, bought the earrings and said “xie-xie,” “thank you” in Mandarin, to Teng.
For Teng, life before the U.S. was good. She was working at the local department of education after she graduated from college. But that wasn’t enough, at least for her parents.
“I guess you can call it the American dream,” Teng said, to explain why her parents wanted her to move to the U.S.
The conversation was soon interrupted as it was a busy day at Teng’s store. Occupying the spot next to the mall’s gate, her shop got the most traffic.
Three blocks away, Luzhi Xiang was sitting behind her counter at Gift for Time, an accessory store. Her shop opened recently.
Tucked all the way back in the narrowed hallway that can barely fit two people at the same time, Xiang’s shop doesn’t get as busy as Teng’s.
Xiang, who moved to Flushing a year ago, had some time to kill, so she was answering messages on Wechat, a social media platform based in China. She was deciding with her friend where to eat after work.
Xiang moved to the U.S. also from Fujian, but she did so largely to be with friends. She came on a 10-year tourist visa after her friends who moved to Flushing earlier told her that the area’s market was booming.
The 10-year tourist visa Xiang mentioned was part of a deal made between former President Barack Obama and China’s President Xi Jinping in 2014. Under the deal, which was put into effect Nov 12, 2014, both countries extended the multiple-entry tourist visas to 10 years instead of the previous one year .
“Everyone comes to visit America,” Xiang said. “It’s so convenient now.”
The selection of jewelry at Xiang’s is more trendy than what you’d find at Teng’s. Many designs follow what celebrities in China and Korea are wear.
Despite their differences, both stores have something in common: they are struggling to make a profit, as Flushing’s rents have risen dramatically amid an immigration influx from mainland China.
The monthly rent for Fine Gift Shop, with less than 100 square feet, has risen from around $7,000 to almost $10,000 in the past three years, according to Teng. Xiang, too has seen rent rise dramatically, to $2,600 per month compared to last year’s $1,800.
Teng said her landlord didn’t explain the reason for rise, but she believed it’s to keep up with the demand as more immigrants flow into Flushing.
They “fired up the market price,” she said.
“I didn’t do enough research before I entered this market,” Xiang said in Chinese. “It’s so hard to do business here. Almost every shopping mall here has empty retail space.”
Right across from Xiang’s shop, the space seemed to have been recently cleared, with signs that say “Space available for rent” in Chinese.
“Flushing’s market is not that simple, but they [Chinese immigrants] want to give it a try anyway,” Teng said. “They came and they left. And more come.”
Xiang has learned that jewelry alone can’t enable her to survive in the Flushing market. So she also sells earrings, maternal and baby supplies, and nutrition supplement bottles.
Teng also has been adding products to her inventory.
“I used to only sell earrings, and it was fine,” Teng said. “Now I have to come up with new products like hats, phone chargers, cases. I feel exhausted.”
Other Flushing retailers see the same trends.
Jeff Kim, a manager at Valentine Mall, saw his rent rise recently. At his mall, on 39th Avenue in a part of downtown Flushing considered more Korean, the rent has climbed 40 to 50 percent over the past two years.
Kim attributes the rise to large, mixed-use projects like Queens Crossing and Skyview Center that were built in 2007 and 2010, respectively.
Queens Crossing, a block from the Main Street Subway station, is owned by F&T Group, a New York-based real estate development with a focus on the Chinese market. Skyview Center on College Point Boulevard is owned by ONEX Corporation, a Canadian private equality firm, according to F&T and ONEX’s websites.
Kim said that newly arrived immigrants from China “weren’t familiar with the previous rent, so they accepted whatever was offered.”
Flushing’s businesses have been through lot of turnover. A 2013 study conducted by Asian Americans for Equality, a non-profit organization based in New York, shows that more than 50 percent of the 400 small businesses surveyed in Flushing have been operating for five years or less, while only around 12 percent have been around for more than 20 years.
John Choe, executive director of the Greater Flushing Chamber of Commerce, said that if nothing is done by the local government, Flushing will be in trouble.
Choe mentioned a rezoning project named “Flushing West” that was scrapped by City Councilman Peter Koo who represents Flushing. The project would have provided more affordable housing along with new retail and open space, Choe said.
DNAInfo reported in June 2016 that Koo sent asked Mayor Bill de Blasio not to move forward with this plan, which he described as “a classic example of stuffing ten pounds of potatoes into a five-pound bag.”
Flushing has long been considered as a hotbed for small businesses — especially for people who moved from mainland China — because of its language and demographic advantages.
Immigrants are attracted by several factors, and the main one is cost. In China, Teng said, people usually “have to invest at least several millions of RMB (at least $160,000) to start a new business. But in Flushing, it can be as cheap as around 100,000 RMB (around $16,000).”
And some Chinese immigrants are surprised by the ease of starting a new business.
Johnny Zhu, who owns Palace, an eatery in downtown Flushing that serves food from Henan, China, said he was surprised when he found how simple it was to rent space.
For a meeting with the landlord, “I brought all the documents to prove my credit score,” Zhu said. “But in Flushing, they don’t check the score.”
Zhu said a lot of landlords understand that new immigrants often don’t have high enough credit scores to rent commercial space, but they do have cash. So, landlords let them put down a six-month deposit as an alternative.
To save expenses, some businesses have retreated to less-trafficked areas in Flushing and are relying on online ads.
Chris Xue, a hairdresser at MG Hair Artistic Salon on 39th Avenue, said almost all of his customers come from advertisements they put on Wechat. The salon is located on the second floor of a side street facing a new construction project, which is off the radar for people visit Flushing.
As for Teng, a single mother of two, she’s committed to the Flushing market.
“I have a family. It’s not like I can just leave everything behind,” said Teng. “And how do you know moving to another place would be any better?”
