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Critics of NY’s New Commercial Rent Control Laws Voice Their Opposition

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NEW YORK, NY - APRIL 11: Empty store fronts stand in a trendy West Village neighborhood on April 11, 2017 in New York City. Many residents and tourists alike are noticing an increasing number of vacant storefronts throughout Manhattan as rents increase and many shoppers continue to migrate to online purchases. According to the Real Estate Board of New York (REBNY), retail rental rates in Manhattan rose 17 percent, from $130 in the fall of 2013 to $156 dollars per square foot in the fall of 2015. (Photo by Spencer Platt/Getty Images)

By Howard M. Riell

A variety of organizations have voiced unified opposition to the City Council’s proposed commercial rent control legislation, which was previously outlined in the Jewish Voice.

The proposal fails to address the increasing burdens facing small businesses “and will force successful ones to flee the city. NYC’s Department of City Planning and the City Comptroller both recently reported that the issue of retail vacancies is not a citywide problem. In fact, data shows that retail vacancy rates are driven by rising property taxes, longer wait times for government approvals, e-commerce and various other factors,” said James Whelan, President, The Real Estate Board of New York.

“The small businesses we speak to cite many factors that negatively impact their current condition, starting with overburdening government regulations and the added costs of implementing a significantly higher minimum wage and paid sick time”, said Randy Peers, President & CEO, Brooklyn Chamber of Commerce. “Rent increases come up, but it really depends on the type of business affected, and is more pronounced in some commercial districts than others. It seems to me we should be looking at a comprehensive set of reforms in a true effort to save our neighborhood small businesses, rather than pit one industry against another.”

While “well meaning,” the legislation being introduced in the City Council that would implement commercial rent stabilization across New York City would have “unintended consequences that would hurt small businesses throughout the five boroughs. Though designed to benefit mom and pop shops, this legislation actually favors large chain stores over small businesses. It makes it incredibly difficult for successful small businesses to move into larger spaces, hindering their growth. We encourage the City Council to scrap this misguided legislation, and look forward to working with lawmakers to come up with a proposal that helps New York City’s small businesses grow and thrive,” said Thomas J. Grech, President & Chief Executive Officer, Queens Chamber of Commerce.

Jessica Lappin, President of the Alliance for Downtown New York said, “Small locally owned businesses are the backbone of New York City and what make it different from other places around the globe. They employ New Yorkers and give our neighborhoods character. Their importance is hard to overstate. And today, they face a myriad of challenges. The pressure of e-commerce alone is enormous. But beyond that, while rent is a factor, what we hear most from struggling business owners are complaints about bureaucracy and unresponsive city agencies, crippling property tax assessment increases, over regulation, scaffolding that obscures storefronts, traffic, and aggressive enforcement.”

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