Small businesses in the Big Apple are trying to survive in an economic crisis that increases every day.
New York City has been one of the hardest hit by the coronavirus pandemic. The great capital of the world has not been able to recover from a crisis that many experts consider greater than the one that occurred during the Great Depression or the fall of the Twin Towers.
In New York, small businesses, especially those owned by Latino owners, have struggled to stay afloat, while others simply lost the battle and closed their doors.
With a medium revival, some small businesses in New York City have been able to recover, however, they now face another problem: lawsuits for non-payment of rents.
A group of New York City homeowners have sued dozens of small businesses for failing to pay rent, according to the outlet. The City.
In a particular case exposed in the aforementioned media, it reveals that a tenant sued a small business owner. The owner claimed that the small business had a debt of more than $ 25,000 in rent.
The owners of small businesses in New York City do not find a support to help them stay active, so many have made the decision to close, and most of them, permanently.
“I have nothing. I have not paid the mortgage on my house in six months. How am I going to deal with it? You know, it just makes life harder. That’s it”, one of the owners sued told the local outlet, The City.
The covid-19 pandemic has caused many small businesses to face lawsuits for delayed rent, including an audit conducted by NYC Hospitality Alliance revealed that 87% of bars and restaurants New York City residents were unable to pay their rents in August due to a crisis.
Janice Mac Avoy, co-director of the real estate litigation division of the Fried Frank law firm, said that in her career she had never seen a rent debt as high as the one currently experienced in New York.
Mac Avoy said New York State judges can be “very strict” when it comes to enforcing a contract.
“The New York courts strongly believe that part of their role is to preserve the sanctity of New York as a banking center by preserving the predictability of contracts. And so the courts are generally very, very willing to enforce contracts as they are written, even if it seems to have harsh results. Mac Avoy added.
Although rental lawsuits in New York are nothing new, the COVID-19 pandemic is showing up as another kind of crisis, and judges are still determining how the courts should act in rental cases at this time.
A survey conducted by the National Retail Federation reveals that more than half of the large retail chains across the country managed to reach an agreement with their owners for the payment of rents.
It may interest you: 87% of NYC bars and restaurants were unable to pay their August rent due to the crisis
More closures for the economy
Small businesses in New York are part of the engine of the economy. The demands that the owners make of the owners of these establishments would generate a much greater collapse than the New York economic sector is already experiencing.
In a scenario, where the owners win the lawsuits, the owners of the small businesses will have to close, since they do not have enough funds to pay and be able to stay open.
The closing of more commercial establishments in New York City means a break in the economic system of the Big Apple that has tried to recover.
And although the Andrew Cuomo government has extended the moratorium on evictions until January 1 of next year, small businesses will need much longer to recover some of the income they lost during the coronavirus stoppage.
In the month of September alone, unemployment affected 9.7% of the entire New York population, a considerably high figure, according to economics experts.
With the arrival of a new wave of infections, small businesses are again threatened with a possible closure. The New York authorities, although they have already implemented new restrictive measures, a decision has not yet been reached that determines a complete shutdown of the economy.
It is expected that in mid-December, the covid-19 vaccine will begin to be distributed in the country, however, so far it is unknown how the distribution procedure will be.
You can also read: Eviction moratorium extended to businesses in New York
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