Avella’s bill balances scale in business lease renewals

Avella’s bill balances scale in business lease renewals
Photo courtesy Tony Avella
By Joe Anuta

State Sen. Tony Avella (D-Bayside) hopes a proposed bill will give small business owners more clout in lease negotiations within the five boroughs.

Avella discussed the Small Business Survival Act in Flushing Tuesday alongside the Small Business Congress, the Korean American Small Business Service Center of New York and the Coalition to Save NYC Small Businesses.

“A crisis has befallen the small business community in New York City,” the lawmaker said. “Throughout the city, we have seen far too many small businesses closing due to skyrocketing rents. That is why the ultimate intent of this legislation is to give rights to small businesses to allow them to negotiate reasonable lease terms with their landlords.”

The bill, which was referred to the Committee on Cities in April, would apply to commercial lease renewals and would amend the law to provide several protections for small business owners.

Tenants would be able to opt for lease renewals of 10 years, according to the legislation, and when a landlord is planning on renegotiation, the tenant would have to be notified 180 days in advance.

Once the process begins, according to the bill, the landlord and tenant can hammer out an agreement on their own, but if no accord is reached, the tenant would have the right to request a mediator, with the cost borne by both parties.

If the two parties still cannot reach an agreement, then a arbitrator whose decision would be legally binding could be called in, according to the bill.

In addition, if a landlord opts not to renew a lease, the tenant must be notified 180 days in advance and would have the option of calling in an arbitrator.

“This legislation will help to truly combat this small business crisis by preventing out-of-control rents that force small business owners out of business,” he said, adding that it is needed legislation since so much of the city’s economic strength comes from mom-and-pop shops.

But there are several guidelines under the bill that tenants would have to adhere to in order for the protections to apply.

For example, if the tenant consistently fails to pay the rent on time or uses the business for purposes other than what was previously agreed upon, the tenant would lose the right of renewal, according to Avella.

Reach reporter Joe Anuta by e-mail at [email protected] or by phone at 718-260-4566.

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