Shifting demographics are taking a toll on Greenpoint's kielbasa-laden meat markets, kasha-serving restaurants, keks-making bakeries, and book and video shops selling all manner of Polish-language products. Though the neighborhood is still an ethnic stronghold, nearly half a dozen Polish eateries have been replaced in the past year by a polyglot wave of spots, including Japanese, Indian and Thai—even a Starbucks.

"Americans want more diversity," says Marzena Wierzbowska, director of the community action program at the Polish and Slavic Center, on Kent Street just off Manhattan Avenue, the commercial spine of the longtime Polish enclave.

With more hip, young co-op dwellers moving into the Brooklyn neighborhood and more Polish families shipping out, Greenpoint's old-line business owners face a stark choice: try to edge into the mainstream, or follow their erstwhile neighbors to nearby Maspeth and Ridgewood. A steep run-up in Greenpoint rents over the past five years has helped make the latter increasingly tempting.

Danuta Kurzna, who for a decade has owned Donna's Grocery, a dimly lit shop on Manhattan Avenue that sells mostly ethnic fare, estimates business has dropped by about 10% in recent years. "I don't have the newcomers," she says.

Chris Peck is an example of why. A computer programmer who moved into the area four years ago, Mr. Peck hardly ever steps into the bakeries and butchers that once dominated Manhattan Avenue.

"I don't eat kielbasa too often," says Mr. Peck, browsing the wire-rack shelves at The Garden, a brightly lit, upscale 14-year-old market on Manhattan Avenue that specializes in organic products. "I'm a vegetarian."

Why bother?

Skyrocketing rents are exacerbating merchants' woes. Since 2005, storefront rents on Manhattan Avenue have jumped more than 20%. A typical 1,000-square-foot retail space commands about $3,800 a month, compared with about $3,000 two years ago, according to Shaya Grosinger, associate broker at City One Real Estate in Greenpoint.

Many business owners, faced with the steep odds against survival, seem to have given up.

Many Polish restaurants, for example, have not spruced up their interiors or broadened their menu offerings with lighter, less-ethnic fare—steps that could not only attract some newcomers, but also help justify a price hike.

Instead, many eateries haven't raised their prices in well over a decade. As a result, a dinner entree at a typical Polish spot costs between $6 and $8. Some owners fear that any changes could drive away longtime patrons.

Early 1990s pricing

The owners of Happy End, committed to staying the course as a Polish specialty restaurant, recently hiked entree prices, but by a mere 25 cents. Its highest-priced selection—a fried flounder dinner with a salad and choice of a potato or kasha—now sets a diner back $7.50.

"I don't have a choice," says Macin Cyran, the owner's son. "If I increased prices more, I would lose customers." That's something he can't afford. In the past two years, Happy End's business has plummeted 20%.

Krystyna Dura, the owner of Christina's Restaurant, is taking a more aggressive stance because she has to: The rent for the 15-year-old spot is going up 40% in December.

She recently completed a $100,000-plus soup-to-nuts renovation. As part of her effort to expand the customer base and raise the price point, Ms. Dura is also revamping the menu. For example, she's adding a grilled salmon with portobello mushrooms that will sell for $12—40% more than the most expensive dish now.

The dream of many restaurateurs and retailers is to do what Marian Mikolajczyk has done at his 2,500-square-foot Polish supermarket, Green Farms. Instead of reaching out to the new crowd, he has remained focused on goods from the old country and established Green Farms as a place that shoppers travel miles to get to.

"I have had a steady clientele for many years, and my customers drive in from all over—Long Island, Westchester and New Jersey," Mr. Mikolajczyk says.