The question posed by some landlords, often in less than genteel tones, – “Who is paying you?” speaks to the essential issue of our jobs. The correct answer is NO ONE, unless of course, a deal is done. We are not paid to find someone for a space, or find a space for someone, but to broker a deal between two parties. We have done our job only if we get paid, and we only get paid if we bring two parties together to execute a lease. This gets more complicated when lawyers and architects enter the mix. So for landlords, the answer is, you are paying me if I get you a deal in spite of yourself. We must find the most diplomatic way of imparting the idea that just because a landlord is good at buying buildings, it does not mean that they are as good at closing leasing deals with tenants. The same holds for tenants. An owner of a retail business might have some experience doing deals and working with people. However, that does not make them a lease negotiator and closer. So the honest answer to that question is, I do not work for the landlord, nor do I work for the tenant. I work for the DEAL

Brokers must diplomatically defuse tensions that arise when emotions flare at moments of impasse. The end of the lease negotiation period is always the most difficult. Weariness of the process, and perceived slights caused by the sense of giving in too much always threaten the end game. Bringing it home then and being able to close, is what separates successful brokers from stymied ones. The key here is to get both sides so angry at you for being so persistent that any residual animosity gets deflected to you. Opposing parties become partners in getting the deal done.

We should embrace rather than avoid the duality of our role, and be able to intelligently and openly explicate it to all sides. The best analogy is to a diplomat. They are employed precisely for their skills/abilities at being able to open the eyes of both sides to the needs of the other. Diplomats clarify to their own governments how a small accommodation to the needs of another nation creates a reciprocal situation, and therefore an atmosphere of amenability conducive to agreement. Openness and honesty creates trust. And trust does deals.

According to administration officials, the 200 establishments serviced so far, have opened, on average, 10 weeks faster than planned. Nice, considering how little free time is often offered in a new lease. Currently the team is comprised of four inspectors, plus supervisors from agencies that issue permits, like the Depart of Health, Department of Buildings, Fire Department and Landmarks. The hope is that at one point there will be a single restaurant license that would replace all others. A long range goal is something like a Mayor’s Office of Hospitality.

NBAT works with qualifying businesses to schedule and coordinate most required inspections and, when appropriate, to schedule multi-agency inspections on the same day. For example, NBAT works with the Bureau of Fire Prevention to ensure the timely submission of plans and equipment documentation as well as provide inspections regarding range hood devices and other hazardous installations. NBAT inspectors are also trained to conduct Department of Environmental Protection grease interceptor inspections ensuring that grease traps are correctly sized to handle grease discharged by cooking and kitchen equipment. NBAT works with the Depart of Health to ensure that all food service establishments are properly permitted and operating safely. NBAT, and the Department of Buildings, work together to ensure the safe and lawful use of buildings and properties while facilitating the issuance of Certificates of Occupancy and Place of Assembly permits.

The ideal participants in this program are generally; new restaurants, bars, bakeries or butcher shops seating 50 people or less. Qualifying bars must serve food. However Batali’s mammoth Eataly found a way to be serviced. While a new venture, it is hardly a small place, and ownership is hardly inexperienced. As always, there is a way around certain limiting requirements. Therefore I suggest all who are opening a new food business to seek this valuable help. For complete information, as well links to the specific city agencies involved, go to: http://www.nyc.gov/html/nbat/html/about/about.shtml

Good luck- get picked and get open quick.

Ingredients from the best brands will be represented, the real heirlooms; Kraft American cheese, canned fruit from Dole, and Ham from Hormel. The menu is yet to be announced, but Spam will be in there somewhere for sure.

Nocavore promises a refreshing return to simple dining. It looks to be a huge success. After all people vote with their feet, and resent being told what to eat.

The Alcoholic Beverage Control Law prohibits certain licenses from being issued if the location of the establishment is on the same street and within 200 feet of a building that is used exclusively as a school, church, synagogue, or other place of worship. This restriction is for retailing establishments selling liquor for both on and off premise consumption. There are specific rules for the measurement. For corner locations, the building is considered to be on both streets, whether or not there is an entrance to the building on both streets. If the SLA finds that a place has been licensed in violation of the rule, it cannot allow the violations to continue when the license comes up for renewal. There are exceptions to the rule under a “Grandfather “clause. Some of these are: establishment in operation since December 5, 1933, or if the location was licensed before the school/place of worship existed. The courts have adapted a test that looks to whether a building is uses primarily as a school/place of worship. The building will still be considered as such, as long as any other use is incidental to its primary use. In 2007 the rule was amended to clarify this by listing what type of use is deemed incidental.

The 500 foot rule is a bit more complicated. The Alcoholic Beverage Control Law contains restrictions on the approval of certain on premises liquor licenses, if the location is within a 500 foot radius of certain other establishments with on premise liquor licenses. It is important to note, that this applies to only “full” liquor licenses, and not to wine and beer. However there are many exemptions to the rule.

The “Grandfather clause” exempts any licensed establishment that has been continuously licensed since the rule went into effect on November 1, 1993. It does not matter what kind of license was issued for the location, or whether it had been licensed to the same person or corporation. If a location is subject to the rule, the SLA must make an affirmative finding that it is in the public interest to issue the license. In New York City, this “500 foot hearing” is usually done after the local community board has met and given approval to the location, although this is not strictly necessary. Among the considerations the SLA uses to judge are: The number and type of other establishments nearby, the effect of vehicular traffic and parking in proximity, impact on existing noise level, history of ABC violations, and any other factor positive or negative that will affect the public interest. If a local Community Board has certain opposition to issuing a license to a location, it can request stipulations to be met that the SLA will incorporate into conditions of the license privilege. It is important to note that a renewal of a license cannot be denied because of the 500 foot rule. Applications to approve corporate changes are also not subject to the rule.

As in any question regarding governmental regulations, knowledge is power. Rather than relying on urban legend, consult first with an attorney specializing in liquor laws. Then begin the search for restaurant space.

The guarantee puts a principal on the hook for unpaid rent, but if there’s nothing owed when the tenant leaves, the principal is free and clear and does not need to pay a penalty. All future obligations are laid on the tenant corporate entity which, if the tenant is going out of business, likely has no assets. The purpose of the good-guy provision is to provide an incentive for a tenant to leave the space instead of holding on and forcing the landlords to seek an eviction.  It provides an exit strategy that works for both sides

Bureaucrats reverse logic “if it ain’t broke don’t fix it” becomes “if it succeeds suspend it”

Dennis Rosen, SLA chairman, recently announced that the phenomenally successful self-certification program for liquor license applications will end as of June 30th. The backlog of licenses was reduced from 2116 last October, to 817 this month. Waiting time for approval in New York City is now less than three months for most applicants. This proved to be a major boon to restaurateurs seeking to start new places. Speedy approval helped solve the recurring landlord tenant leasing conundrum of liquor license contingency. This helps deals get done and new businesses to open. And of course gives a nice shot in the arm to the City’s economy.

The logic for terminating something that worked so well is a fine example of governmental doublespeak and trepidation. Mr. Rosen cited critics who felt that it “created a two-tier system to fast-track applications only from those who were represented by lawyer” Quite democratic, sacrificing the good of the probably 90% of those who use a lawyer, to the few who can’t, or won’t, hire one. Opening a restaurant is a business decision about capital expenditure. It should not fall under the auspicious of a social services viewpoint. Concern for helping those without access to proper funding falls to other city agencies.

Hopefully, other newly implemented measures might keep the backlog from rebuilding. According to an article in the Times, these include “the appointment of an internal auditor at the authority, and the assignment of examiners who prescreen applications for missing information — kicking them out quickly for re-application — as well as a redesign of the authority’s intake process requiring fewer examiners to review each application. In addition, a new system to electronically receive required photographs of restaurants — and the fingerprints of the owners — will remain”

Mr. Rosen did offer hope that the program might be re-introduced, but only “if government furloughs or layoffs “or other policies are implemented due to the budget crisis that might impact our ability to get our work done — then we could re-institute the certification process,” Perhaps this might offer him a way to rescind a quite ill advised decision to terminate a very positive program that helped so many in the restaurant and real estate industry.

NY Times February 12, 2010-“Surprising Strength in January Retail Sales”

http://www.nytimes.com/2010/02/13/business/economy/13econ.html?scp=1&sq=retail%20sales&st=cse

“Sales at retailers were unexpectedly strong last month, suggesting consumers were feeling a little more comfortable about spending, which could improve prospects for first-quarter economic growth. Retail sales rose 0.5 percent as consumers stepped up spending not only on essential goods but on luxury items as well, the Commerce Department said on Friday”

NY Times March 4, 2010- “Despite Storms, Stores Beat Expectations with Relatively Strong Gains”

http://www.nytimes.com/2010/03/05/business/economy/05shop.html?scp=5&sq=retail%20sales&st=cse

“ Despite fears that snowstorms in February would dampen sales, the nation’s stores posted their strongest results on Thursday since late 2007, suggesting the beginnings of a broad recovery in retailing. Nearly every major chain turned in robust figures, beating analysts’ expectations and recording the sixth consecutive monthly sales increase. Even long-struggling stores and sectors came back from the dead.”

Using the Wall Street yardstick that the market predates the economy by six months the, good news/bad news index seems to indicate that stores might see real gains for Back to School selling in August. Eighteen months ago the papers were littered with stories indicating the likelyhood of a possible depression. The bad news indicator stood at 100%. The pendulum began to swing back about 6 months ago. Here and there, some positive reports appeared. Now the anecdotal evidence seems to point to a fifty fifty mix of hopeful versus frightful. Nice! My guess is that on the ground, store owners in the City might soon get some real evidence of this change in perception. Sales should start to increase. Perhaps, in a few months, business might actually look good to some store owners. And optimists always, they will look to expand, taking advantage of increased availability and lower rents.

Broadway between 33 to 23 streets is an emerging area that deserves the attention of forward thinking restaurateurs and retailers. It is a hodgepodge strip with no charm and plenty of low end mercantile activity. This is exactly the type of counterintuitive neighborhood, disdained and avoided, that Soho, Meatpacking, and Williamsburg once were. It has an interesting mix of buildings presenting a variety of opportunity. I call it LowBrow, a fittingly ironic name. Development has started, as noted in the link below. Nightlife, always the precursor to other growth, is already there to some degree. However the neighborhood is still in the first iterations of change. Therefore the risk/reward ratio resonates.

http://www.nytimes.com/2010/02/14/realestate/14streets.html?ref=real-estate

http://www.nytimes.com/2009/10/28/dining/28liquor.html?_r=1&scp=1&sq=liquoe%20license&st=cse

Dennis Rosen, the newly installed chairman of the SLA, instituted a process of self certification by lawyers to ease the backlog of 2116 applications of which 1018 are older than a year. Mr. Rosen also said he had hired Michael Jones, a former prosecutor in the Manhattan District Attorney’s office, to “oversee the Harlem office and clean it up.”

If true, this is incredible news. The sometimes 6 month wait for approval, might cease to be the bane of lease negotiations for restaurant owners, landlords, and brokers.