On a recent Friday evening in Paragon, a two-stage dance club that sits in Bushwick, Brooklyn, under trace traces, party goers have printed their bodies to the blow of the rave music. Silhouettes fluctuated in the less spacious basement than the Blue of Blue from the ceiling's LED lights unveiled young faces.
It was “definitely a good night for us,” said John Barclay, the owner of Paragon, the next day in an SMS.
But a fully packed dance floor alone is not equally successful for a night club: “A Good Friday and Saturday evening in 2025 is not enough,” is the easiest way to express it, “added Mr. Barclay, a nightlife veteran, in an interview.
The club concludes April 26: “After almost 3 years in which we can have an event location with some of the best people in the world, we simply cannot afford the financial reality of this industry in 2025 and will close our doors in April”, the association published on its social media at the beginning of this year.
In view of the bitter ecstasy of a farewell rave, a group of night clubs that extend from Bushwick to nearby Williamsburg have gone out of business in the past few months – victims of persistent rent, spike insurance tariffs and reduced income from the alcohol of young people who drink less alcohol.
The closure of Paragon, a club that has sold out nights, remembers that the night life business depends moody and partly on the commercial real estate market.
“It all hit hard and let everyone ask what happened out there,” said Rafael Ohayon, who leads the club Gabriela in Williamsburg with the DJ Eli Escobar and relates to paragon's closure. “That was far too early,” he added.
Williamsburg was once a port with a low rent for a creative class and has changed to high-end single chains and luxury owner apartments. Although rental prices in certain parts of the neighborhood have not reached their preparatory highs, they have increased steadily since 2021, according to a report by the New York real estate committee, which was published in 2024. The rent in a set of blocks has increased by 70 percent since 2023.
Alex Picken, who owns Picken Real Estate, a brokerage company that specializes in hospitality, also noticed the increase in rent in its shops. He said that most of the warehouses in the neighborhood, which could possibly have been adapted to a nightclub, could have been going for 10 to 20 US dollars per quadrap: “Now it is difficult to find a little below $ 30 per square foot.” (Mr. Barclay rejected the rental price of Paragon.)
The rent became a problem for FreeHold, the popular café turned a night club on the south side of Williamsburg after new owners bought the building and two adjacent packages. Brice Jones, the managing director of FreeHold, said that in 2023 he had completed rental extensions in a process known as a baseball arbitration procedure, in which the landlord and the tenant present their separate ratings to a third party, which is then the most sensible. The referee was on the landlord's side, said Jones and tripled the rent of around $ 21,000 per month.
Like many other hospitality rooms, FreeHold troubled to make the money it had before the start of pandemic. Despite the enthusiasm after the Lockdown, which reached nightlife in the summer of 2021, FreeHold ended the year with only 55 percent of the turnover that it achieved in 2019, said Jones.
“I remember how I looked at the sales report in Free Hold, and I think: 'How is it so bad?',” Said Jones. “I would see the line around the corner, and I would either steal here or there is not something here. There is like a breakdown in the system.”
Insurance
In the third quarter of 2024, the insurance premiums rose by 5.1 percent by 5.1 percent by 5.1 percent by 5.1 percent by 5.1 percent, according to a report by the Council of Insurance Officers and Makers. Jelani Fenton, Managing Director of EG Bowman Co., an insurance agency based in New York, said that a great reason for night clubs are the rising costs for the “plaintiff -friendly” juries in the state of New York.
“Restaurants, bars and other facilities could be collected into a lawsuit by a customer who injured a third after a night of drinking,” he said in an email.
The insurance premiums had a growing burden for Gio Gulez and Mehmet Erkaya, the two owners of TBA Brooklyn, a popular medium -sized Williamsburg nightclub with a DIY aesthetics that was announced in February that it was the store. Mr. Erkaya said that her insurance costs had increased from 25,000 USD to $ 125,000 within almost 12 years.
“It's almost like we are fighting all of these obstacles,” said Mr. Gulez. “And at some point, especially if you are older, you say: 'Well, what do we do here? We only work for insurance companies.' It is almost like making money, and then on the first day of the month we just give it over.
The amount
Night clubs make money mainly with alcohol sales, and their core demography is at the age of 21 to 34. According to a Gallup survey, this amount has less than prepared and a general awareness for various reasons, which include less personal conviviality and a general awareness of the risks of alcohol.
“You see a real shift in alcohol consumption,” said Max Chodorow, a veteran of the hospitality industry, which belongs to Jean's, a restaurant in Manhattan, which also has an underground club. “So you see a real change in the sustainability of nightlife in its current format.”
Nevertheless, there are clubs that have managed to stand out and be sustainable. Many regular guests for nightlife look at Gabriela, Mr. Escobar and Mr. Ohayon's Spot, a success story that the quality of his DJs and the ability to draw a lot – “like a really nice house party”, as Mr. Ohayon describes it.
The steady amount that Gabriela attracts has not isolated its owners from hardness of the overfitting. Mr. Ohayon said that “little business owners turn around”. They admitted that the costs rose and the costs for event locations such as Paragon are.
“It offers many of the same things we are talking about,” said Escobar. “It is a unique place in New York nightlife, so it's difficult to wrap your head for it.”