Is Retail Rent Stabilization on the Way?

Soon the other shoe might drop. Five months after the state Legislature passed the sweeping Housing Stability and Tenant Protection Act, which gives renters extensive new safeguards, a New York City Council member is getting ready to introduce another landmark bill – one that would regulate commercial rents in the city, Gothamist reports. 

Council member Stephen Levin, a Brooklyn Democrat, plans to introduce the legislation as a way of combating the epidemic of vacant storefronts across the city, a problem familiar to many co-ops and condos that own commercial space. "It's a complex problem," Levin  says. "We think it’s time to introduce this into the conversation." He adds that his bill will provide a “clear and predictable framework for rental increases in commercial spaces.” 

The problem of empty storefronts is often attributed to soaring rents, though online shopping certainly plays a role. According to a recent study by New York City comptroller Scott Stringer, vacant retail space in the city roughly doubled over a decade, up to 11.8 million square feet in 2017 from 5.6 million square feet in 2007. During this period, retail rents rose by 22 percent on average across the city. 

In July, the City Council passed a package of legislation that will enable the city to track retail vacancies. Not long afterwards, council members approved wider protections for commercial tenants, prohibiting landlords from harassing small business owners based on their age, race, gender, and immigration status. 

Lena Afridi, who has been working with United for Small Business NYC, a coalition of roughly a dozen community groups, says the commercial rent stabilization bill was crafted with the input of her group, which has been advocating for protections for commercial tenants for the past three years. "We are looking forward to getting real, meaningful protections to end the displacement of small businesses in immigrant communities and communities of color," Afridi said in a statement. 

Levin says of his forthcoming bill: “It's fair to property owners. We’re certainly not taking away their livelihoods. We’re saying there has to be some fair rubric in all of this to allow smaller businesses to compete for their existence.”