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Landlords are growing desperate. As the effects of COVID-19 continue on, Landlords are worried about the vicious spiral that could ravish New York for years to come. "We're creating our own fate by not bringing people back and restarting the largest economic engine in the country, " said Rechler, whose RXR controls 25.5 million SQFT of commercial real estate. Following up with "It's as much of a civic obligation as anything else." Many building owners are in the same boat, pushing for CEOs and their lieutenants to bring their workers back to their offices. They are hoping to spur some economic activity to keep businesses alive, but with no clear end in sight, no one knows when things will fully start up again. Hudson Yards is also continuing to look grim, as Neiman Marcus ditched its anchor spot, other retailers are now considering the same. Once thought to be a key location, it now looks like a ghost town to its former glory. Many are saying the city needs to step in and offer some assistance or relief as landlords and businesses alike struggle.
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A light in the dark? Small businesses see a glimmer of hope as Mayor De Blasio changes direction on the small business rent assistance program. Initially looking to cut the program, his administration stated, "We are going to bring back an approach that worked in the past, and we're going to make it work again for small businesses that need help." The program was a massive boost in giving small businesses the footing it needed to fight large landlords. Providing legal services that were otherwise unaffordable, the program stopped many evictions and held landlords liable for breaches of contract and landlord harassment. This was not the only good news for small businesses. City Comptroller Scott Stringer proposed a plan for the struggling mom and pop shops. His idea was to use refundable business income tax credits and commercial real estate tax incentives to save local businesses. Stringer's second plan aims to create an outreach team to help businesses access the remaining $150 billion in the Federal Paycheck Program. He also briefly floated the idea of giving businesses 30 days to address any violations: "The bureaucracy and multiple agencies you have to deal with, it's just becoming impossible," Scott Stringer could be the help small businesses need to survive.
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Someone is coming out ahead. A veteran investor takes advantage of the effects COVID-19 has brought onto office spaces. Jonathan Litt, 56, has managed to use his latest strategy to take on shorting New York office spaces. Litt warned in a six-page paper that an existential crisis was making its way to the market, mentioning Empire State Realty Trust would suffer the most. Litt hopes to come out on top with his latest stunt. Shorting big offices. Litt stated, "You can't sugarcoat how difficult the NYC office market will be in the coming years." Describing the market in free fall with ESRT down nearly 50% and others trailing behind. With his clean strategy of using white papers, videos, and slick websites, Litt is set to come out ahead.
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Industry City’s rezoning proposal, made public in 2015, was controversial from the start, but tensions have only seemed to rise. The city planning commission has announced its support for the rezoning, directly in conflict with a multitude of city council members. At the lead, New York City Council Member Carlos Menchaca, who represents Brooklyn’s Sunset Park neighborhood, announced he would officially oppose the rezoning application submitted by the owners of Industry City – a sprawling, 35-acre complex that once housed heavy manufacturing, but now includes retail, offices, storage, and restaurants. Commission Chairwoman Marisa Lago stated, "We know that for our city to function, we need both warehousing space and space for job dense uses close to where Yew Yorkers live, and the industry city proposal can provide both - without public subsidies or public capital investments on the underutilized privately owned 30 ace facility - but only if we update our long-outdated zoning."As the city is hurting for cash, many see this as the perfect time to approve the development, making the case that it will provide much-needed jobs to the surrounding area and give it the economic boom it needs. Menchaca disagrees, releasing his statement, "Nowhere was there an acknowledgment of the subset park community's deepest concern, which is that the rezoning will cause a rise in rents and displacement of its working-class immigrant families."Industry City CEO Andrew Kimball still hopeful to see the rezoning pass said he'd continue to work with the community and city council members as it enters approval for its final phase.
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