BY RICHARD BEALES

Fuggedaboutit. That’s what London and New York would love to do with Covid-19. It won’t be easy in the new year. But the two financial capitals should start to see urban buzz return.

The cities remain atop the Global Financial Centres Index. Both nonetheless face big challenges, from budget shortfalls to difficult property markets and cash-strapped transport systems. They will also both elect mayors in 2021.

London, also vulnerable to Brexit, saw its housing market dry up during coronavirus restrictions. Partly thanks to tax breaks, though, prices have so far held up on year-on-year comparisons, the UK House Price Index shows.

Housing transactions in the Big Apple have also slowed dramatically, though median sale prices in the third quarter were flat or up compared with a year earlier in Manhattan, Brooklyn and Queens, according to Douglas Elliman. Rents are down but may have found a floor: New Manhattan leases rose 30% in November on the year.

Commercial property vacancies are up and rents and investment transactions down since before the pandemic on both sides of the pond. Subway ridership in New York remains down about 70% from a year ago. Even bridge-and-tunnel road use is still off by around a fifth, according to Metropolitan Transportation Authority figures. Two-thirds fewer people took the London Underground in October, Transport for London says.

Transportation is one of few London features over which Mayor Sadiq Khan – favorite to win re-election in May– has greater influence than New York counterpart Bill de Blasio, who will leave in 2021 because of term limits. Khan negotiated a bailout of TfL with the UK government. The MTA is the responsibility of New York State.

Khan’s job is more about corralling central government and individual boroughs on behalf of London’s residents and businesses. De Blasio, in contrast, has a near-$100 billion operating budget and needs to replace tax income lost in the pandemic. New York is, for example, asking bond investors for some $1.5 billion of cash in mid-December. A week before the offering, Fitch Ratings downgraded the city’s credit, saying Covid-19 damage could linger.

New York had doubters after Sept. 11, to cite just one instance, and London so far hasn’t succumbed to worst-case Brexit scenarios. Both have shown over centuries that they can bounce back from the Black Death, storms and other disasters. With vaccines offering hope of subduing the coronavirus, the cities’ next mayors should see that start to happen.

First published December 2020