For a century or more, small, locally-owned businesses have been the economic, and even social, cornerstones for hundreds of urban neighborhoods around the country. Now, these cornerstones are being threatened by rapidly-rising rents from the large real estate firms that own the properties – rents that are increasing so much, largely as a result of gentrification of these neighborhoods, that many of these small businesses can no longer afford to pay them.
New York City is a particular hotbed of this activity, largely as a result of gentrification trends. According to www.kingscountypolitics.com, the city's court system currently warrants storefront evictions at the rate of almost 500 per month. The site highlighted the plight of one business in particular, Jesse's Deli, in the Boerum Hill neighborhood, which is on the brink of being forced out as a result of its rent being increased from $4,000 a month to $12,000 a month. "Commercial rents in our city in neighborhoods like Boerum Hill or Greenpoint/Williamsburg are forcing out small independent businesses," said Stephen Levin, a Northern Brooklyn city councilman. "Jesse's is a perfect example."
A local New York City paper, Bedford & Bowery, noted that "sky-high rent hikes and unfair lease agreements are putting local stores out of business."
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An article in another New York City paper, the Gotham Gazette, noted that "the average retail rent in Manhattan has risen 22 percent over the last decade, causing a sprawl of small businesses to relocate or simply close." It added, as an example, that one property management firm is poised to evict virtually all of the store owners in a block in Washington Heights. The article explained, "This is New York today. The plight of the city's small businesses is grumpily accepted like a late train. It's perceived by many New Yorkers as a part of the city grind, the dog-eat-dog, if-you-can-afford-it-here-you-can-afford-it-anywhere reality of a town teeming with opportunity, but becoming evermore competitive and expensive." The essence of the problem, according to the article, is that commercial tenants have far less protection against sudden rent increases than residential tenants (such as apartment dwellers) do. "No one is lobbying the state legislature for commercial rent control, so obviously legislators are not thinking about the issue," said Michael McKee, treasurer of the local Tenants PAC. In sum, small businesses have no legal powers against immediate evictions or rent gouging.
In a recent article, WABC-TV in New York noted that, "Local stores, opening long ago and now sitting on prime real estate, may be forced out of business as their rents suddenly jump 150 percent." The article profiled a Brooklyn convenience store owner, Jesse Itayim, whose landlord wants to raise his rent from $4,000 a month to $10,000 a month. Itayim, whose family has owned the business for 30 years, noted: "You come in, you spend all your effort and time and money to make a living, and, all of a sudden, it's impossible, because we are a convenience store. We're not a major super market."
The problem is not limited to New York, though. An recent article posted by KDVR-TV in Denver noted, "The real estate business is booming in the Denver metro area, and the rising rent is forcing some small businesses to shut down. Over the past few years, property values have skyrocketed in and around the city. Landlords are doubling, even tripling, rent for businesses." The article went on to explain that stores are being forced out of the city, and some small business owners noted that, not only is the rent rising too high for them, but that many landlords are now demanding conditions that small companies just can't meet.
Further west, in San Francisco, similar problems exist. A recent article in the San Francisco Chronicle noted that tensions are growing in the Mission district, where upscale businesses are trying to force out local small businesses. The article queried, "What kinds of businesses belong in a neighborhood, and who gets to decide? That question is fueling tensions in a neighborhood beset by an influx of new residents, sparkling new buildings, and steeply rising rents." One Mission district business owner, Erick Arguello, was quoted as saying, "Twenty-fourth Street has always had a different feel to it. It had the butcher shops, the bakeries, the shoe repairs. We are trying to maintain Latino businesses and smaller mom-and-pop businesses."
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