Building Trades, Features, Law and Politics, New York, Retail

Two Unions Oppose Curbs On NYC Commercial Rents

October 24, 2018

By Steve Wishnia

NEW YORK, N.Y.—With the City Council holding its first hearing in nine years on legislation to restrain rent increases on small businesses, two of the city’s main labor unions have quietly come out against the measure, the Small Business Jobs Survival Act.

SBJSA opponents make their position known inside City Council chambers.

Both the Building and Construction Trades Council of Greater New York and the building-service workers’ union 32BJ SEIU submitted testimony opposing the bill at the Council Small Business Committee’s hearing Oct. 22. The SBJSA, sponsored by Ydanis Rodriguez (D-Manhattan), would give commercial tenants the right to get 10-year leases and take their landlord to arbitration if they believe a rent increase is too high.

“This bill will stifle new construction, renovation, and rehabilitation of existing buildings in New York City,” the Building Trades Council’s Santos Rodriguez said in a one-page statement. That, the union said, would “limit and detract from job opportunities in the construction industry that would otherwise be available to help provide hundreds of thousands of New Yorkers with the opportunity to earn a middle-class living.”

32BJ, which represents building-service workers such as security guards, doormen, and janitors, opposes the bill on similar grounds. As the bill would cover tenants in offices as well as storefronts, the union contends, it would restrict the amount of rent building owners could collect—which would mean they’d be less likely to spend money on services.

SBJSA supporters rally on the the City Hall steps ahead of hearings.

“When building workers unionize and win a contract for the first time, it is possible that a building owner may seek to recoup the change in labor costs from their commercial tenants,” 32BJ vice president Denis Johnston testified. “It would be a terrible unintended consequence of this bill if restrictions on commercial rents were to stand in the way of workers unionizing.”

Ray Rogers of the Campaign to Stop REBNY Bullies says unions should not be taking the same side as the Real Estate Board of New York, the landlords and developers’ trade organization that is the leading opposition to the SBJSA. REBNY President John Banks told the Council that if the bill passes, the organization would challenge it in the courts on the grounds that it is effectively commercial rent control that the city can’t enact without a state law authorizing it.

“It’s a fight for workers as well as small-business owners,” Rogers told LaborPress at a rally outside City Hall before the hearing. “REBNY, the same real-estate lobby that has fought this bill for 32 years, is trying to destroy the construction unions.”

“It’s a fight for workers as well as small-business owners. REBNY, the same real-estate lobby that has fought this bill for 32 years, is trying to destroy the construction unions. — Ray Rogers, Campaign to Stop REBNY Bullies

Passing the SBJSA intact, he said, would mean “the transfer of billions of dollars and the power that comes with it” from landlords to small businesses and their workers.

While the vast majority of the city’s estimated 220,000 small businesses have less than 20 employees and are thus largely nonunion, City Councilmember Ben Kallos (D-Manhattan), an SBJSA cosponsor who has regularly appeared at union rallies over the past two years, says that lowering commercial rents would enable them to pay workers more.

“This is about jobs and making sure people have job security,” he told LaborPress. “I think landlords are pulling too much equity out of the businesses and not leaving enough for workers.”

October 24, 2018

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