I’m sure complying with new regulations will be something business owners will implement regardless of the resources they have access to. Some will wait until an inspector walks in to cite them for something they had no idea how to execute or knew about, but hoped keeping the doors opened will help allocate funds to make the changes to comply.

Safety is first, but what’s second to a business owner is to remain in business!

What’s third is to make sure you have a place to operate the business, which means the landlord is third. The gap between the second and third is a gray area which government shed no real guidance to clear up the lines. No real direction because their is no funding to black and white the disputes.

NYC is built off of small businesses, regardless if you choose to support a small business or not – the presence of a small business adds a certain ambiance to each neighborhood. As a real estate professional, I’ve seen residents sway towards a certain place to live because the yoga studio falls right into their lifestyle, or the art supply shop is opened on Sunday or even the doggy daycare is right around the block. It’s just what it is – small businesses do have an effect on everyday life. Even on a corporate business level, chains rely on “shopping districts” which are mostly made up by mom & pops think 3rd or 5th Avenue.

I’m not saying that every small business will fail, or every small business will flourish – I’m saying the gap between a tenant and landlord can be resolved by local government, without allocating more federal funds to save local businesses.

The main proposed solution is to issue NY government bonds. Sounds wild, but think about it? NY businesses were built off the hustle and bustle atmosphere, foot traffic, tourism, gatherings, etc. Taking away people by limiting capacity, now you’re running a NY business in a small town atmosphere, but still paying NY rent. The solution is safety – but at whose expense?

It shouldn’t be the landlord that just payed close to $2 mil for a mix use on the Avenue, nor the tenant that is paying a rent to make ends meet for both their living and the property’s capital rate- it should be a cost to the city.

Bonds, makes a good solution because the city can issue them today, recipients can use them to borrow money today, or sit on them for later, and cash them out when NYC is back to the city that doesn’t sleep. Small businesses, and landlords already believed in NYC, I’m confident that they’ll hang on even longer if local government believes better days will come.

Problem A: If you’re a tenant behind in rent, and you’re landlord has an outstanding mortgage

Proposed Solution: A1: A landlord can comfortably cover the mortgage payment while working out terms with current tenant. In exchange, local government will issue government bonds to that landlord, and those bonds will be cashed out years from today whenever “things are back to normal”. In the event a landlord can’t cover their mortgage, the landlord will now have another asset which is not a clapped out real estate property to use as collateral to pull out funding to keep the property afloat.

Solution: A2: The Mortgagor will have to accept payments on the back end of the mortgage where the tenant will do the same with their rent – this seems to be what’s on the table now, but no guidance to tenant if the property owner has accepted this solution. Tenant can still be burdened with a non payment lawsuit if landlord doesn’t extend the offering.

No Solution A3: The tenant defaults on the rent, the landlord defaults on mortgage – banks foreclosure on the property. A new owner purchases the property cheaply and  therefore can lease for cheap – a 2008 play.

The only federal help local government will need is to make sure the banks forbearance period will be carried out until the end of a tenants lease/mortgage maturity date – whichever comes first.

Problem B: If you’re a tenant behind in rent, and you’re landlord has NO outstanding mortgage

Solution 1B: Landlord can comfortably or not, cover all other bills while working out terms with current tenant. In exchange, the local government will issue government bonds to that landlord, and those bonds will be cashed out years from today whenever “things are back to normal.”  In the event a landlord can’t cover bills, landlord will now have another asset which is not real estate to use as collateral to pull out funding.

Solution 2B: The landlord should receive a property tax break for forgiving a small business’ rent indefinitely.

No Solution 3B: The landlord will bankrupt themselves at the expense of a failing business. As the rent paid by the tenant was their only source of income.

Problem C:  ou’re a tenant paying your rent during a pandemic although your business is struggling/failing.

Solution 1C: Government should issue bonds to the small businesses to be cashed out after “things are back to normal”.

Solution 2C: The government should forgive /reduce fines through our bureaucratic system – and offer no penalty compliance guidance to all small businesses.

Solution 3C: The Government should put all bureaucratic office representatives in one room, so guidance is a one stop shop for all businesses.

Regardless if you’re a tenant or a landlord, our local government needs to realize that we both make up our neighborhoods. We both invested capital, and ideas to beautify our streets, and offer a way of life in each one of our neighborhoods. It can’t be a blame game, it can’t be “you signed a lease” it can’t be “I have a mortgage to pay, you have to leave”.”

I’m a small business owner and a real estate broker – I’ve represented both landlords and tenants, one party trying to meet a certain cap rate, and another to find a place to make their dreams/ideas come to life. The grey area needs to be addressed by local government, persevere the ambiance our neighborhood developed, save investments and dreams by coming up with solutions that our local mom & pops can take advantage of.”

Ahmed ended with: “You heard it here first, come up with a way to issue government bonds to small businesses, or landlords – and the fear of loosing the New York lifestyle to a small town miles left or right will be saved.”