Yesterday author Karen Seiger reported on her blog, the Markets of New York, that Essex Street Market butcher Jeffrey Ruhalter was in trouble. According to a press release she received from his publicist, Jeffrey was “running out of options” because his “landlord (was) requesting an $8000 renewal fee on the first of March along with a rent increase of 29 percent.”
“Although what Jeffrey needs is an investor or someone to buy the store,” the release added, “what he may really need in the future is a job.” For a couple of years now, he’s been holding out hope that a reality tv show and/or a book offer would come through. In December, the New York Times reported Jeffrey thought about shutting down last year but eventually “got his groove back.”
This morning, we contacted Jeffrey’s landlord, the NYC Economic Development Corp., to get more information. Spokesperson Julie Wood emailed us the following statement:
We’re tremendously excited that we’ve been able to open the market seven days a week, giving tenants an opportunity to raise more revenue. However, in this difficult fiscal environment, the City has to look carefully at every expense, and unfortunately we cannot afford the level of subsidy that we have given to tenants in the past. We would be happy to work with any tenant who wants to reduce their rent, so that we can retain the excellent vendors that make Essex Street such a great neighborhood resource and destination.
Sources tell us all public market tenants whose leases are up for renewal are facing the same percentage increase (29%). Jeffrey is not being charged a renewal fee, but is required to put down a larger security deposit. He must pay an extra $849 to bring the total security to $8000. Jeffrey’s new rent would be around $46/per square foot.
We stopped by the market a couple of times today. Jeffrey did not come in to work, but we hope to speak with him tomorrow. There are, of course, at least two ways to look at the situation. Even with the rent increase, Jeffrey would be paying about half what tenants in market rate spaces on the Lower East Side are being charged these days.While the city subsidies have been reduced, they’re still significant.
On the other hand, most of the small businesses in the Essex Street Market could have never been started and, given their narrow profit margins, would not survive if forced to pay market rate rents. As Jeffrey (a fourth generation LES butcher) points out, he’s done a lot for the community. He held a free “Recession Dinner,” feeding more than 100 people. And (again from the press release):
Jeffrey has had to raise his prices a little bit but he’s reached the neighborhood limit. “Raising my prices anymore is like telling the community I can’t feed you anymore.” Jeffrey’s could not have made it this far without the multi-generations of customers that have supported the store for over 75 years as well as the new influx of customers coming into the store to have a real butcher feed them.
Tonight, Jeffrey picked up some important support — from City Councilmember Margaret Chin. We just received this statement from her office:
“I am outraged to learn that the EDC, New York City’s agency charged with economic development, is slamming small businesses in the Essex Street Market with a 29% rent increase. What is truly unbelievable is that this Mayor would raise the rents on small local businesses while refusing to ask the top earners to pay their fair share with an income tax surcharge. While we must balance this year’s budget in a fiscally responsible manner, we cannot do so on the backs of small business, the middle class, and working families. I demand that the EDC reduce these rent increases, even down to those which might be charged at luxury commercial developments. No responsible landlord should hand their tenants double-digit rent increases in this fiscal climate, least of all our great City.”