Proposed NY Bill to Offer Relief to Both Owners and TenantsMarch 24, 2020 | Erez Glambosky | Jeremy B. Honig |
On March 23, 2020, New York Senate Deputy Leader Michael Gianaris introduced proposed legislation which, if adopted, would expand upon the unprecedented Executive Order issued by Governor Andrew Cuomo on March 20, 2020, imposing a 90-day moratorium on all residential and commercial evictions. The proposed bill is intended to provide financial support to residential and commercial tenants and commercial landlords who have been impacted financially from the coronavirus crisis.
The proposed legislation seeks to protect residential and commercial tenants who have suffered, and will continue to suffer, financial difficulties as a result of the COVID-19 pandemic by waiving rent payments for certain residential tenants and small businesses for 90 days.
The proposed bill, which still needs the approval of the Senate, Assembly and Governor in order to become enacted as law, provides, in part, as follows:
- Any residential tenant or small business commercial tenant in New York State who has lost income or been forced to close as a result of government orders/restrictions relating to the coronavirus will have all rent payments waived for 90 days.
- Every residential or small business commercial tenant (as defined in the proposed legislation) whose lease expires during the rent waiver period shall be entitled to an automatic renewal lease at the current charged rent.
- Late fees are not collectible during the rent waiver period.
Recognizing that landlords will be adversely affected by the proposed rent waiver, the proposed legislation also provides financial protection to qualified landlords. Specifically, landlords who face a “financial hardship” as a result of the proposed rent waiver will be entitled to forgiveness on mortgage payments on the subject property in an amount prescribed in the formula set forth in the proposed legislation.
There is no guarantee that the proposed bill, whether in whole or in part, will eventually be signed into law. Our firm continues to closely monitor proposed and adopted legislation and orders which impact our real estate clients.Rivkin Radler LLP remains available to assist during this unprecedented time and will continue to update the real estate community on this and other developments as they unfold.
- Erez Glambosky
- Jeremy B. Honig