July 25, 2014


I traveled somewhere for a gig and when the club picked me up from the airport, they asked me if I wanted to grab something to eat. How could they possibly have guessed that I did? Anyhoo, I asked them what kind of restaurants were around and they replied "Everything." What they meant was a strip mall where "everything" from Olive Garden to Taco Bell to McD's were located. A snooty NYC eye roll followed. Chain restaurants are all they had nearby. Well, the same thing is happening here in NYC. I walked for blocks to find a non-chain restaurant in midtown recently. And they're closing up all over Manhattan, giving the borough a very tired shopping mall feeling. As I say in Clowns Syndrome, both parties pretend to support mom & pop businesses and claim they are the backbone of the American economy. Yet neither party actively supports this ailing backbone.

"There is a loss of pride, a loss of belonging, to be a New Yorker."

This article was sent to me by Nicky Perry´╗┐, a neighbor and friend who owns Tea & Sympathy´╗┐, which serves english fare. English food isn't exactly known for being tasty, but when Nicky makes it, it is. Within a few years, she'd opened two more tiny stores: Tea & Sympathy to go and fish & chips shop called A Salt And Battery. But when St. Vincent's hospital closed, much of her lunch clientele vanished with it. And she's struggling, as are mostl small businesses, to pay high rents. Rents which aren't as high for national chains. That are turning NYC into McHattan with no interesting, unique choices like Tea & Sympathy. And we are hemorrhaging jobs as small businesses close.

Mayor Deblasio claimed to support small businesses while campaigning, but he's doing little to address the crisis after he got into office. I don't know if you will read this entire long article or call your council member to see if s/he supports a bill before the City Council. But I would like to share a few excerpts so you can see how dire this crisis is. We pay a lot of rent in NYC--one of the reasons why is that our city is unique. Small businesses have always defined that uniqueness.

GOTHAMGAZETTE.COM: City's Small Business Crisis Continues

Umberto's Clam House. Gray's Papaya. Union Square Cafe. These famous, long-established New York City businesses and many more are victims of circumstances advocates say come down to a lack of protections for commercial tenants. Given the recent focus on residential tenants and affordable housing, many don't realize the bitter plight of the city's small businesses, especially low-profile mom-and-pop type stores and restaurants.

And these establishments - the city's small businesses - are desperately looking for help.

Few New Yorkers can't name a favorite local business or neighborhood staple forced to close over the last several years. Bodegas, Korean markets, and Irish Pubs are now considered to be part of a dying breed - endangered species poached by high rents, corporate competitors, and real estate development deals. Large swaths of commercial areas have all but disappeared from Little Italy, Chelsea, Hell's Kitchen, and Bedford Avenue in Williamsburg. Empty storefronts litter the five boroughs, sometimes for weeks, months, even years.

Ramon Murphy, president of the Bodega Association of the United States, told the Daily News the main reason for all the small business closings "is the one-sided process of lease renewal...Landlords either do not renew them or want to raise the rent four or five times. Often, you have to give money under the table for the lease to be extended."

The crisis Barrison describes has been building for decades: from 2002-2012, during Mayor Michael Bloomberg's tenure, the city's Landlord and Tenant Courts issued 83,211 warrants to evict commercial tenants, according to SBC data. SBC believes for every business that fights in court, two walk away, and estimates that at least 240,000 businesses closed and between 2.5 and 2.8 million jobs were lost (gross, not net) over the combined years of the Giuliani and Bloomberg mayoralties.

Landlords evict commercial tenants for a variety of reasons. Often, tenants fall behind paying escalating rents, but don't want to walk away from their life's work. Activists say they see a growing trend by which owners move faster to evict because they want to make space available for a corporate franchise or a bank, which can and do pay substantially higher rents.

Even though thousands of new small businesses also open every year, the odds are against their success and many close within the same year they open. Sung Soo Kim, who is president of the Korean-American Small Business Service Center (KASBSC) and has been called the godfather of New York's small business community, explains the significant obstacles against success, chief among them being high rents and operating costs. With the city's small businesses providing the large majority of jobs for New Yorkers - and establishing a gateway to the middle class, especially for immigrants and in ethnic communities - many, including Kim, wonder why little has been done by city government in the last twenty years to stem the tide of business closings, particularly of long-standing, neighborhood establishments.

"It's a crisis," agreed Ron Shiffman, founder of the Pratt Center for Community Development. "There's a dramatic impact on neighborhoods, especially on lower income folks [who rely on] inexpensive stores and culture, who get priced out," Shiffman said, referring to gentrification. Shiffman says the importance of neighborhood small businesses is that they "hire locally, they contract out services, their purchases are local. A dollar recovered in the local community [means] far more than it does [from] corporations."

The city's small business community is looking to its local government to act before entrepreneurship is further stifled and every mom-and-pop store is replaced by a corporate chain, making "family business" an oxymoron.

Please read on to see how Deblasio has appointed a former Bloomberg staffer to head up the SBS, which deals with this. Deblasio has focused on reducing fines, not absurd rents. And the Bloomberg staffer has partnered with Citibank to get loans for small businesses. But unless sky-high rents are address, expect lots more loans. (Which is probably the only reason Citi would partner with anyone.) This is very sad to read.

But Kim, who is also co-founder and president of the SBC, explained his members ask daily for assistance because the City only views them as "cash cows." He discussed the psychological damage and disenfranchisement that's been festering as a result, "There is a loss of pride, a loss of belonging, to be a New Yorker." In 2013 alone, 24 percent of Korean-owned businesses closed, Kim said.

And Kim doesn't buy the myriad of services and initiatives SBS promotes. "SBS programs are ridiculous and worthless to the majority of NYC hard-working immigrant owners," Kim said. "There is nothing more absurd," he added, "than a loan program to [businesses] who can't pay their rent."

With an "absurd" strategy, things aren't looking good for small businesses in NYC. Deblasio doesn't appear to be getting his promises right. So if you appreciate them as I do and I suspect you do, I hope you'll consider reading this article in full and then phoning your council member to encourage their support the upcoming SBJSA bill. Ifthis doesn't concern you, enjoy your hot dogs from 7/11. You ain't gonna get none from the recently closed Gray's Papaya!