Stuyvesant Town’s Associated Supermarket is facing an uncertain future. (Photo by Sabina Mollot)
By Sung Soo Kim, President, Small Business Congress
Lawmakers claim proposed legislation will save mom and pop businesses. Small business advocates claim it’s a “Trojan Horse” created by the real estate lobby to keep status quo. Who is right?
For over 30 years I have pleaded with local government to pass legislation protecting our hard working small business owners from profiteers, unscrupulous landlords and greedy speculators. The past decades’ over-speculation in commercial real estate, bidding wars by franchises and banks and manipulation by warehousing storefronts, has wreaked havoc on the commercial rental market. Guided by big real estate campaign contributions, their friends at City Hall have remained silent and done nothing as the American Dream of our small business owners is being destroyed.
At first I was pleased to hear the commitments of Manhattan Borough President Brewer and Council Member Cornegy, to listen to the business owners and to pass legislation to save our businesses. Brewer said, “The mom-and-pop crisis has intensified with a fury.” CM Cornegy acknowledged numerous small and locally-owned businesses that many would describe as New York City institutions were forced to close or relocate as a result of exorbitant rent increases. Both lawmakers’ words sounded very encouraging and offered hope to small business owners who had become indentured servants to their landlords.
But upon analyzing their proposed solution to end this crisis and stop the closing of long established businesses, I have become saddened for the future of our struggling business owners. Their proposal is an insult to the desperate business owners whose survival depends upon fair and just treatment from government’s offering a real solution to end the crisis. The Brewer/Cornegy proposal is no solution in any way and would not save a single small business if passed into law. In fact, their proposal to extend the lease period for one year at 15 percent rent increase, allowing the business more time to find a new location, would, instead, actually help landlords and make the crisis much worse. Rent gouging and oppressive lease abuses are the root of this crisis and their solution addresses neither.
The rent gouging and oppressive lease abuses have been going on for many decades. Many business owners have already been forced to move several times. This gentrification tornado of greed has cut swaths of destruction across many neighborhoods and in every borough. There are no more “safe” locations to move to in NYC, because our government has done nothing to regulate the out of control rents. If a storefront is vacant on a busy main street, it’s because the long established business was forced to close when the landlord refused to accept a fair rent which would have allowed a reasonable profit for the business. I predict that if this weak Brewer/Cornegy proposal is passed, should a business want to stay in their neighborhood, the only choice is to go to another landlord and bid against other local businesses, making the crisis worse.