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NY Restaurants Left Vulnerable As State’s Commercial Eviction Moratorium Lapses

Gov. Andrew Cuomo’s moratorium lapsed on January 31, allowing eviction proceedings to move forward for now

A stock image of an eviction notice
The commercial eviction moratorium lapsed on January 31 in New York
lakshmiprasada S/Shutterstock

New York’s commercial eviction moratorium — which protected commercial tenants, including restaurants, from evictions during the COVID-19 pandemic — expired on January 31, and at least one NYC establishment has already received an eviction notice. The Lower East Side Coffee shop, located at 442A East 14th Street, at Avenue A, closed last week and there’s an eviction notice dated February 4 that’s been slapped on the coffee shop’s entrance, EVGrieve reported.

Both the coffee shop and the building’s landlord, Pattwin East Realty Corporation, did not return a request for comment. Gov. Andrew Cuomo — who repeatedly extended the eviction moratorium through the course of the pandemic — has no intention of issuing another executive order at present, according to a spokesperson, but he is instead focussed on passing legislation that would give both commercial tenants, like restaurants, and landlords, some reprieve until May 1, 2021.

The exterior of a coffee shop on East 14th Street with a bright red neon sign
The Lower East Side Coffee Shop on East 14th Street
Via Google Maps

That legislation was proposed by state Sen. Anna M. Kaplan, who represents parts of Nassau County, on Long Island, and while that bill has passed both the state senate and the assembly, legislators and the Governor’s office are still hammering out the details before Cuomo signs it into law.

It’s not yet clear when that might happen, and in interim, more New York restaurants risk facing eviction notices. Spokespersons for both Cuomo and Kaplan’s did not immediately specify what modifications were holding up the bill from being signed into law.

“As the Governor has said, we are doing everything we can to help small businesses weather this crisis, including prohibiting commercial evictions and protecting landlords from foreclosure,” said Jack Sterne, a spokesperson for Cuomo, in an emailed statement.

“We are working on getting it passed as soon as possible,” added Sean Ross Collins, a spokesperson for Kaplan. “We don’t want anyone to be suffering right now.”

Still, with the moratorium elapsed, it appears that the Civil Court of the City of New York has approved an eviction warrant for the East Village coffee shop.

Meanwhile, if Kaplan’s legislation is signed into law, it will afford protections to small business owners who employ 50 or fewer workers and landlords who own 10 or fewer units, whether located in one building or over multiple buildings.

Tenants, including restaurant owners, who are unable to pay rent can submit a letter to their landlords showing the loss in revenue due to the COVID-19 pandemic and that will ensure protection from eviction through May 1 this year. Landlords, similarly, can submit a letter of hardship to their mortgage lenders or foreclosing party to prevent a foreclosure until May 1. They can also submit this document to the city or state to prevent tax payment-related foreclosures or lien sales.

The legislation covers eviction actions filed on or before March 7 last year or 30 days from when this bill is signed into law. But it does not cover cases where a warrant has already been issued, as is the case for the East Village coffee shop. In cases where a warrant has not been signed, the legislation will grant a 60-day pause on any proceedings until a judge can determine if the eviction can move forward.

There is, however, a provision which allows landlords to pursue eviction when tenants are “continuing to persist in engaging in unreasonable behavior that substantially infringes on the use and enjoyment of other tenants or occupants or causes a substantial safety hazard to others,” according to the legislation. A landlord would have to submit documented evidence in support of “unreasonable behavior,” to make the case for eviction, according to the legislation.

Previously, East Village Filipino spot Ugly Kitchen was evicted even while the moratorium was in place and the landlord claimed at the time that she saw “terrible conditions,” at the restaurant, though the restaurant’s chef alleged they were wrongfully evicted with no notice whatsoever.

New York moved to ban residential evictions at the end of last year, with the deadline for those also set to May 1, but the same didn’t happen for commercial tenants who have been relying on a series of executive orders from Cuomo to protect them from eviction.

The restaurant industry has faced catastrophic losses since the start of the pandemic, and more than a thousand restaurants have closed in NYC as a result. A November 2020 survey conducted by the NYC Hospitality Alliance revealed that 88 percent of the more than 400 restaurants surveyed were not able to pay full rent, further compounding the rent crisis the industry has faced since the start of the pandemic.

While the eviction ban may prevent restaurants and bars from losing their physical spaces, they’re still on the hook to eventually pay any unpaid rent. Several restaurant owners have worked out new deals with their landlords, and some have been paying rent as a percentage of their monthly revenue. Still, many others are expected to pay full rent, and hospitality industry organizations say that without any meaningful rent cancellation or government aid, restaurants will continue to suffer even after COVID-19-related restrictions have been relaxed.

Passage of the $120 billion RESTAURANTS Act — which the Biden administration has shown an inclination to pass — would provide a significant degree of relief. State Sen. Michael Gianaris had introduced a bill soon after the start of the pandemic last year to cancel rent payments for 90 days, but that bill has since stalled.

Read Kaplan’s full bill below:

UPDATE: A previous version of this article stated that city’s Department of Investigations handed out the eviction notice. Eater regrets the error.