Steve Soutendijk testifies against Intro 90's mandatory lease extension provision

I will now call the next panel.

Steven Sotendyke.

Thank you for the pronunciation.

Joanne Podell, Zach Steinberg, and Lacey Tober.

Okay.

Sorry, Lacey, I have you in the next panel.

I'm sorry.

Yes, there you go.

Good afternoon, Chair Thomas Henry and members of the committee.

Oh, sorry.

Stephen, before you start, I just want to make sure you did have two cards, right?

It's the same Stephen?

Yes, ma'am.

Okay.

They asked me again to fill it out.

I'm sorry.

No worries.

But see, when you filled it out, you did.

Good afternoon.

My name is Steve Soutendijk.

I'm a commercial real estate broker specializing in New York City retail market.

I would like to focus my remarks on Intro 90.

I support, like most of the commercial brokerage community, reasonable transparency and protections for small businesses in the leasing process.

But Intro 90's mandatory one-year lease extension could introduce significant uncertainty into a market that serves tenants and landlords alike.

First, this proposed legislation is being introduced at a time when New York City's retail market is thriving.

Small businesses are opening and expanding.

Available space has declined along many prime retail corridors.

And tenants'rents generally remain below pre-pandemic levels in many parts of the city.

Second, owners already have...

have strong incentives to reach agreements that retain successful and reliable tenants.

Replacing a tenant means marketing the space, paying brokers, negotiating a new lease, and accepting the risk that the storefront may remain vacant.

I've seen time and time again that an owner will work with a proven tenant who has been there for years rather than start over with an unknown business.

Third, commercial spaces are often committed to new tenants months before an existing lease expires.

Under this legislation, an existing tenant can unilaterally remain for another year, potentially leaving a new business that has already spent money, hired employees, or planned an opening around a specific date without access to the space.

It's not fair and it's not great public policy, especially since

Major global companies could take an extension the same way a small mom and pop could.

Lastly, this would affect more than property owners.

Newer, smaller businesses often lack the financial history or operating experience of established tenants.

This uncertainty...

Of a mandatory extension would introduce, that the mandatory extension would introduce could make owners cautious to lease to them, only making it harder for entrepreneurs to open their doors.

The council is right to support small businesses in transparency in the leasing process, but this can be accomplished without disrupting negotiated leases or creating uncertainty for the small businesses waiting to occupy these spaces.

Thank you for your time and consideration.

Thank you.

Joanne?