Retail Leases Too Complicated For Commercial Rent Control, Landlords Say

As New York state legislators consider limits on commercial rent increases in New York City — a measure that would mirror the existing rent stabilization law that covers 1 million apartments — retail landlords are skeptical that the idea can be easily translated from housing to storefronts.

State lawmakers led by Brooklyn state Sen. Julia Salazar have revived the possibility of creating a commercial Rent Guidelines Board that would determine the maximum to which commercial landlords could increase rents in their properties.

The current version of the bill, which was introduced last year and rolled over into this year’s session, would work similarly to residential rent stabilization.

The measure would set a maximum for allowable annual rent increases, give tenants the rights to renewal and to demand written lease agreements, and make 10-year lease terms standard. 

But at Bisnow’s New York City Retail Conference on Tuesday, retail landlords said their leases are far more complex than what apartment renters sign, a reality that would make stabilization difficult to enforce. 

“One tenant could be doing $3,000 a square foot, versus another tenant could only be doing $100 a square foot,” said Sunny Choi, head of leasing at Madison International Realty, adding that every retailer uses “a different math” to calculate what rents they can pay.

“I think you'll find resistance to that for many years,” Michelle Greenberg, a partner at Tannenbaum Helpern, said onstage during the event at 20 Times Square.

The retail rent board would be appointed by the mayor and comprised of two small-business owner representatives, two small landlord representatives and five public members, one of whom will act as chair.

This isn’t the first time state lawmakers have considered the move. In 2020, then-Assembly Member Danny O’Donnell proposed the measure but failed to garner support, City & State reported. 

The bill’s current sponsors, Salazar and Assembly Member Emily Gallagher, argue that the legislation is necessary because of unsustainable rent increases that have led to closures in recent years.

“ We're seeing massive rent hikes that really no local business could afford,” Gallagher told Gothamist, while Salazar claimed in a statement that landlords are warehousing storefronts “until larger, wealthier tenants come along.”

Gallagher is holding a rally for the legislation next week at Jimmy's Corner, a local bar near Times Square on West 44th Street whose “landlord is refusing to renew their lease,” she wrote in an Instagram post Tuesday.

Retail rents in the city's prime corridors have recovered since the pandemic, and availabilities are at their lowest point in a decade, according to data from Cushman & Wakefield. In the Times Square bowtie, asking rents were $1,597 per SF at the end of 2025, up 2.8% year-over-year. Availability fell from 17.5% to 15.8% over the same time span.

But citywide, the market isn't as robust. Roughly 12% of retail spaces in the city were vacant at the end of 2024, a Bisnow analysis of the most recent New York City data on storefront vacancy found.

Space is rarely kept empty unless a landlord is planning to tear it down and rebuild from scratch, Feil Organization Vice President of Retail Leasing Randall Briskin said onstage, adding that he hasn’t seen any warehousing.

Instead of holding out for retailers that can pay high asking rents, landlords work with tenants to find prices that work for both parties, Marx Realty Vice President of Leasing Henry Henderson said onstage. 

“We do want them to be there long term,” he said. “So, if we have an idea of where their sales thresholds are and what their occupancy costs are, we try to price accordingly.”

Landlords would be ready to comply with the state's data collection requirement if the bill were to pass, Briskin said. The city already requires retail landlords to submit some of the data the state bill would ask for, which includes lease start and end dates, scheduled rent increases, and concessions, among other things.

But as for the rest of the bill’s requirements, he remains confident that state lawmakers will quickly understand why the concept of rent stabilization isn’t easily transferable to storefronts.

“The math is the math,” Briskin said. “It's not going to happen.”