One of the more bizarre proposals in New York real estate to come along in a while is New York City Council’s bill 847 for commercial rent control, Â With office and retail rents plummeting in the City, what is the logic in requiring landlords to go to arbitration in the event the tenant did not agree with a renewal rent (like, always!)? Â According to a memo sent to the membership of The Real Estate Board of New York by president, Steven Spinola
“The bill would mandate lease renewals and the arbitration of commercial rents, would allow tenants to reject the arbitration decision and remain in the space at a five percent increase and grant the tenant a right of first refusal for lease term terms the owner negotiated with a new prospective tenant.”
My guess is that the City Council will see this as the powerful disincentive for investment in New York City real estate that it is, and the bill will eventually die. Â If it did pass, however, just think of the all that demand for appraisal services as landlords geared up for their mandated arbitration! Â May as well call it the Real Estate Appraiser’s Employment Insurance Act of 2009!
