New York recently scrapped a decades-old rule that made dancing in bars and restaurants illegal without a special license, clearing the way for a new generation of community-driven hospitality concepts. The change raised a bigger question for founders everywhere: where in the country can they actually build the kind of place people come back to night after night?

Maxwell Social, a members' club and event venue in New York City, set out to answer that question. We built a Third-Place Business Index ranking all 50 states on the liquor laws that shape whether a founder can open a bar, cafe, or social club, then took a closer look at how that plays out across New York City's neighborhoods.

Key Takeaways

• Washington, Colorado, and Missouri are the best states in America to launch a third place.
• Pennsylvania, Utah, and Idaho are the worst states in America to launch a third place.
• New York ranks seventh nationally for third-place friendliness.
• Manhattan has the most third places of any NYC borough, with 5,722.

Washington, Colorado, and Missouri Make It Easiest to Open a Third Place

Liquor laws vary widely from state to state, and that gap decides who gets the easiest shot at opening the next great neighborhood hangout.

Washington topped our ranking of the 50 states, combining permissive liquor laws with the strongest public search interest in third places of any state we measured. Colorado and Missouri followed close behind, both license states with no cap on how many liquor licenses can be issued. Delaware and Nebraska rounded out the top five, giving founders in all five states a more direct path to opening a bar, cafe, or social club without running into license shortages or added red tape.

Pennsylvania, Utah, and Idaho landed at the bottom of the index, weighed down by license quotas and state-controlled alcohol distribution. Wyoming and New Hampshire weren't far ahead, held back by their own restrictions on Sunday sales and cocktails to go.

What Actually Separates the Best States From the Worst

Our index weighed six factors that shape how easy it is to open and keep running a bar, cafe, or social club long-term.

Some states control alcohol distribution directly, known as control states, while others let private retailers hold the license, an approach that tends to give founders more flexibility. We also factored in whether a state caps the total number of liquor licenses it issues, since a quota can leave a founder waiting years for one to open up.

Cocktails-to-go laws, Sunday sales rules, and happy hour restrictions rounded out the index, since each adds friction for a founder trying to run a modern hospitality concept. Search interest in the term "third places" made up the sixth variable, capturing public appetite for the idea independent of current regulation.

New York ranked seventh nationally on this same index, a strong showing that puts it ahead of 43 other states on liquor policy alone. Where it stands out even further is search demand: New Yorkers look up 'third places' at a rate of roughly 177 per 100,000 residents, one of the highest search-interest rates in the country.

Midtown Is NYC's Undisputed Third-Place Capital

We mapped New York's third places block by block to see exactly where the city's community life clusters.

Manhattan had more third places than any other NYC borough, home to 5,722 of the licensed bars, restaurants, clubs, and cabarets we counted citywide. Within Manhattan, Midtown-Times Square stood out with 923 third places, about 1.7 times as many as the next-closest neighborhood, Midtown South-Flatiron-Union Square, at 551.

Top 10 NYC Neighborhoods for Third Places

1. Midtown-Times Square (923)
2. Midtown South-Flatiron-Union Square (551)
3. Chelsea-Hudson Yards (389)
4. East Village (352)
5. Hell's Kitchen (352)
6. West Village (306)
7. Flushing-Willets Point (291)
8. Williamsburg (282)
9. SoHo-Little Italy-Hudson Square (268)
10. Financial District-Battery Park City (262)

Where the Next Great Third Place Gets Built

For founders scouting a location for their next community hub, the data points to a clear starting lineup: Washington, Colorado, and Missouri offer the fewest regulatory roadblocks. If you're weighing where to plant the next clubhouse, cafe, or members club, the states with the fewest liquor-law barriers are the ones giving founders the most room to build.

Methodology

To determine which states make it easiest to launch and operate a community-forward hospitality business, referred to here as a third place, we built a composite index across six weighted variables covering liquor regulation and public interest:

• Control vs. license state: Whether the state directly controls alcohol distribution (control state) or issues licenses to private retailers (license state), based on data from the National Alcohol Beverage Control Association.
• Liquor license quota status: Whether a state caps the number of liquor licenses available (quota), places a partial cap (quota, partial), or has no cap (non-quota).
• Cocktails-to-go laws: Whether a state permanently allows on-premise retailers to sell cocktails to go, is actively expanding the practice, or does not allow it.
• Sunday sales laws: Whether a state allows off-premise spirits sales statewide on Sundays, defers to local government options, or restricts sales to certain geographic or demographic areas.
• Happy hour laws: Whether a state allows, restricts, or bans happy hour drink specials.
• Search interest in the term "third places": Normalized per 100,000 residents, we captured public appetite for the concept independent of current regulation.

Each variable was scored from zero to one, with the most permissive classification scoring highest and the most restrictive scoring lowest; states with a middle classification, such as local option or partial quota, received a score of 0.5. All six variables were weighted equally and averaged into a composite score out of 100, then ranked highest to lowest.

Sources for this portion of the study include the National Alcohol Beverage Control Association (NABCA), the Alcohol Policy Information System (APIS), the Distilled Spirits Council of the United States (DISCUS), state alcohol beverage control agency websites, and Google search volume data. This index measures liquor policy and search interest specifically; it doesn't factor in zoning, noise ordinances, cabaret or dance permitting, or adaptive reuse policy, since those are typically governed at the municipal level and weren't consistently available across all 50 states.

For the New York City portion of the study, we pulled the New York State Liquor Authority's active liquor license dataset and filtered it to Manhattan, Brooklyn, Queens, and the Bronx (Staten Island was excluded). From there, we isolated license types that function as third places, including restaurants, bars, clubs, and cabarets, while excluding off-premise retail, production licenses, and one-off event venues, for a starting set of 10,810 licenses. We matched each license's geocoded location to its 2020 Neighborhood Tabulation Area, then removed non-residential areas like parks, airports, and cemeteries, arriving at a final analytic set of 10,298 licenses across 180 residential neighborhoods.

Data was collected in July, 2026.

About Maxwell Social

Maxwell Social is a members' club and event venue set inside a historic Tribeca brownstone, built to feel more like a second home than a typical club. Members join in small cohorts and get to know each other over shared dinners, coworking sessions, and events, while the space also hosts private celebrations like weddings and chef's table dinners. Anyone looking to join New York's own third place can learn more about Maxwell Social's membership.

Fair Use Statement

Feel free to use this data and research for noncommercial purposes, with a link back to this page and attribution to Maxwell Social.