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Shutdowns Have Brought New York City to the Brink of Economic Catastrophe

Shutdowns Have Brought New York City to the Brink of Economic Catastrophe

“The knock-on effect is an ‘alarming’ drastic reduction in the number of landlords who will be able to pay their tax bills on July 1 which will result in devastating losses in tax revenue for the city”

Used with permission reader WAJ

Professor Jacobson recently wrote about Ghost Towns USA, with pictures showing quiet and empty streets in New York City, due to the Coronavirus lockdown. If this goes on much longer, the economic effect on the city will be disastrous.

The cracks are already starting to show.

Jennifer Smith reports at the Daily Mail:

Will NYC become a ghost town? 80% of one landlord’s retail tenants skipped April and May rent as companies ‘take a field day’ from office lease payments while weighing permanently working from home – triggering an ‘alarming’ drop in tax revenue

New York City’s real estate market continues to be battered by the coronavirus lockdown and is likely to keep suffering with no end to the current lockdown in sight.

One major commercial landlord said 80 percent of their retail tenants missed rent payments in April and May and others are reporting that even companies that have healthy finances are simply choosing not to meet their lease agreements, amid growing uncertainty over how many businesses will actually work in offices in the future.

Residents are also abandoning their expensive apartments by breaking their leases or failing to renew them to wait out the crisis in more comfortable surroundings. For the rich, that means spacious homes in the Hamptons and upstate and for the young, it is their parents’ suburban homes.

The knock-on effect is an ‘alarming’ drastic reduction in the number of landlords who will be able to pay their tax bills on July 1 which will result in devastating losses in tax revenue for the city and, in turn, the state.

In April, NYC and the state collected just $78.5million in tax revenue on the sale of commercial and residential properties, down from $217.5million in March.

David Marcus of The Federalist recently appeared on the Tucker Carlson show to discuss his New York Post op-ed about the need to immediately reopen the city. Here’s an excerpt:

End New York City’s lockdown now!

Last Friday morning, some 3,500 New Yorkers lined up at a Catholic church in Queens to receive free food hours before it even opened, ­according to the New York Police Department. Catholic Charities has reported a 200 percent increase in demand over the past month and a half.

By prolonging the coronavirus shutdown long after its core mission was accomplished, Gov. Andrew Cuomo and Mayor Bill de Blasio have plunged tens of thousands of New Yorkers into poverty.

It needs to end. Now…

For two months, we have waited for Cuomo and de Blasio to tell us how this ends. Where is ex-Mayor Michael Bloomberg with his alleged army of tracers that the governor told us was the key to reopening? And why did he hand that responsibility over to Bloomberg, whom ­nobody elected anyway?

What the hell is going on?

Small business owners in New York are trying to sound the alarm. Cuomo and de Blasio should be listening to them.

From ABC 7 News in New York:

Coronavirus News: Coalition of small businesses in NYC fighting to reopen shops

Store owners in Manhattan are fighting to reopen their doors and say their livelihoods are at stake.

One clothing store on the Upper East Side has defied orders to stay closed.

While there were no customers at the Peter Elliot store on Lexington Avenue on Wednesday, the store is ready to sell some shirts — no matter what the governor says.

And they are making sure there is plenty of stock for customers — as soon as the customers are ready.

Yes, it violates all the rules of the statewide shutdown, but the owner is all done with the shutdown.

“We are not a country of sheep, but we have been treated like sheep,” store owner Eliot Rabin said.

Everything is connected through the economy. If people can’t work, they can’t pay rent. Then the property owners can’t pay their bills. Eventually, everything crashes.

This is not sustainable. New York needs to reopen.


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    redc1c4 in reply to redc1c4. | May 25, 2020 at 2:13 pm

    and it couldn’t happen to a more deserving group of self-absorbed idiots.

    they voted themselves into this situation, and they got what they asked for.

    and, before anyone starts, i feel the same way about Lost Angels & #Failifornia, where i live.

    pain can be educational: we will see if the fools are capable of learning.

      Conservative Beaner in reply to redc1c4. | May 25, 2020 at 2:27 pm

      Pain is educational but it will be the poor and middle class that will feel that pain. The folks that need to feel the pain are safe in office like DeBlasio and Cuomo along with their sycophants. The police will mostly enforce the lock down just to keep their paychecks.

      That leaves the Marxist/Socialists who will vote far left anyway just to get a check and already hate the police. Good luck New Yorkers as you reap what you have sown.

        CommoChief in reply to Conservative Beaner. | May 25, 2020 at 3:04 pm

        You are correct that the working class folks are being hammered now in NYC.

        What about the future as it relates to the real estate market in NYC? Maybe a blessing in disguise. Less demand = more supply = lower rental rates and lower purchase prices.

        Move the needle far enough and ‘the rent is NOT too Damn high’

        I don’t have enough familiarity with the rent control laws up there to know if they are tied to price points. I seem to recall from grad should case study that they are independent of current price and operate more like a subset ‘property right interest’ that runs with the building vs the tenant. Similar to an easement.

        Maybe a NYC resident could flesh out if plunging demand and broken leases will have any direct effect upon rent control.

          4fun in reply to CommoChief. | May 25, 2020 at 8:50 pm

          Don’t forget to add in PDJT’s SALT deduction reduction. All those state and local taxes they used to take off are reduced in the amount they can claim.
          LOL. Suck it lefties.

      JimWoo in reply to redc1c4. | May 25, 2020 at 10:50 pm

      Same with Illinois.

    notamemberofanyorganizedpolicital in reply to redc1c4. | May 25, 2020 at 3:19 pm

    One flush or two?

    Eric R. in reply to redc1c4. | May 25, 2020 at 3:39 pm

    Why, you ruthless, heartless, racist, sexist, xenophobic, Islamophobic, anti-Semitic capitalist b*st*rd.

    BTW, I agree with you.

    Frank Hammond in reply to redc1c4. | May 26, 2020 at 10:41 am

    For those of us who live in “fly-over” country and have felt the hatred from the smug NYC residents for many years, we don’t care.. All of the TV shows and movies show Manhattan as the coolest place in the World.

    The rest of us in the Mid-West are hay seed, ignorant rubes. This is payback. NYC can fall into the ocean for all I care.

Sooner or later, the citizens are going to flip a gigantic bird (New Yorkers raising a single finger salute? Imagine that!) at the nannies in Albany and City Hall and do what they danged well please. And all us out here in the hinterlands are going to enjoy watching the show.

2smartforlibs | May 25, 2020 at 2:21 pm

Isn’t economic collapse and totalitarian left-wing rule the reason for all this??

No, I repeat no, federal aid, not one red ¢.

These arrogant folks need to understand that they are in trouble because of their OWN shortcomings and mismanagement.

Hey, if the guy down the street sets up a charcoal grill in his living room, and then his house burns down, I’m not sure I’m going to run up there with some money to help him out. Dude, as ye sow so shall you reap.

Ya gotta love the irony of this. Here’s a huge metropolitan area who viscerally and vocally HATES Trump. Now they’re looking to Trump to bail them out because they are have made bad decisions and enacted bad policies. Karma’s a b_tch.

Subotai Bahadur | May 25, 2020 at 2:29 pm

Looking forward to Detroit-on-the-Hudson. They made their choices; forcefully, loudly, insultingly, and frequently illegally. Let them live with the consequences.

My ancestors had a certain skill with wall building. That skill set may come in handy in the Northeast.

Subotai Bahadur

    Eric R. in reply to Subotai Bahadur. | May 25, 2020 at 3:46 pm

    “My ancestors had a certain skill with wall building. ”

    How ironic that your internet name is the very person who defeated that wall.

It would make sense for municipalities who have imposed lock downs to accept a pro-rata reduction in property taxes for the periods of said lock downs…..after all, it isn’t like property owners had any choice or say in the matter.
If you want to rule by fiat, then suffer like your constituents.

Ford to City: Drop Dead.
Better late than never.

iconotastic | May 25, 2020 at 2:55 pm

How many government workers in NYC have been laid off?

    NavyMustang in reply to iconotastic. | May 25, 2020 at 3:03 pm

    I worked in the federal government up until this past January. Not one of my former colleagues has been laid off. Many sit on their bums at home doing nothing, but they’re still making the green.

    And I would be floored to find out that even one guvvie anywhere in the country, fed, state or local, was laid off

    THAT is one of the big scandals of this fiasco.

They haven’t killed enough LTC residents!

Karma or Schadenfreude? Or both?

To parapharase NR’s Williamson (endorsed by #NT French):

The truth about these dysfunctional, upscale communities is that they deserve to die. Economically, they are negative assets. Morally, they are indefensible. Forget all your cheap theatrical Broadway musical crap. Forget your sanctimony about struggling Immigrant Entrepreneurs and your conspiracy theories about the wily Orientals infecting our people. Forget your goddamned lockdown, and, if he has a problem with that, forget Ed Burke, too. The white American upperclass is in thrall to a vicious, selfish culture whose main products are misery and used cotton swabs. Mario Cuomo’s speeches make them feel good. So does OxyContin (but not Hydrochloroquine). What they need isn’t analgesics, literal or political. They need real opportunity, which means that they need real change, which means that they need U-Haul.

Where’s Schumer, Nadler and Cortez, that’s right,they have created such a toxic relationship with the other party that no one wants to listen to them let alone work on solving some of these issues.

Trump to NYC: Not “Drop Dead”, but “F**k You.”

There was an article the other day on either Epoch Times or the Federalist, by a millenial who had moved to Seattle for the promise of metro libtopia life. But with the prolonged lockdown was mulling an exodus to the suburbs or more rural for the free to move about life his overlords took away.

I find it rather satisfying when the form of government libs have wrought on us rise up and bite them in the arse. Though they may run from their monster are they smart enough to change their ways in their new locale? If Clallam co. turning from red to purple is any evidence, the answer seems to be no. Hopeful the lib-gov’t in Seattle, NYC, et al, makes it impossible for the rats to flee.

WA opened up hiking a few weeks ago, the day after which an old high school friend visited us on the Olympic Peninsula to get an early jump on the trails. Traffic is up a little on the Olympic Hwy and the hotel(s) in town are showing signs of life. Nice to see for boosting local business – just hope they “pack out” their liberal garbage.

The bigger the crisis, the more pressure on the Feds to fix it all with a big check. Cuomo and DeBlasio don’t for an instant think that they’ll ever have to pay the bills. If PDJT shows his usual good business sense and tells them to go pound sand, the D’rats believe the devastation and ruin, even though self-inflicted, will sweep them into office, and the next president will see to it that they get their $$$.

Now, I have no problem with this being a “learning experience” for them both, but I’m afraid it won’t happen. “Too big to fail,” and all that. Trump likes winning, but the rest of the Rs are ambivalent about the whole idea.

Unfortunately, there are people out there in the general public who cannot wrap their heads around the fact that most small businesses can’t close down for two months or more and then reopen like nothing has happened. At this point if you’re looking for “solutions” to “help” these businesses “survive”, in a lot of cases you’re too late.

Heavy-handed government shutting down businesses, destroying livelihoods, squelching free speech, putting everybody effectively under house arrest. To call people who support this “liberal” is Orwellian in the extreme.

How dumb is NY “leadership”? THEY GET PAID with taxes….

Follow the dots NY: if NO taxes, NO $$ for you…

badda bing badda bang

    ronk in reply to LisaGinNZ. | May 25, 2020 at 4:37 pm

    like the fact ny wants tax money from the health professionals that went there to help, get real ny. they better not have a real health crisis, I doubt very many health professional would put their lives on the line for the ungrateful jerks that live in the city, and collar counties

Has Bezos sent AOC flowers for interceding Amazon’s behalf and blocking their new Campus in NY City?

“A government with the power to give you everything is a government with the power to take everything away from you” – Gerald Ford.

New York in real time.

Are Cuomo and de Blasio any different that Jonah Goldberg? All three would have the country destroyed if it would stop the re-election of President Trump.

Once the city has to start laying off vast numbers of government employees or freezing their pay, the government employee unions will howl for reopening. Then all of a sudden, covid will disappear because its hurting union members more than Trump.

No doubt the NYC satraps running the asylum are counting on a Democrat victory in November, and a big bag of taxpayer money afterwards to bail them out.

But even if that does not come to pass, what difference will it make? Like all one-party dictatorships, good luck getting rid of the commie crooks at the ballot box. Even if by some miracle DeBlasio gets dumped by the proles, will his successor (almost certainly another Democrat) be any better? You can toss the captain overboard, but the not-so-good ship “New York City” is still taking on water and sinking fast.

There is an old saying that the lessons of history are best read lying flat on your face after you have fallen. In the case of true-blue voters, perhaps not even then. New York City’s descent into an urban version of Mad Max might prove to be unstoppable.

The resistance has begun. The state sheriffs were out in force giving out tickets; we will see what becomes of them.

    That is good news! You don’t need 50% +1 to fight dictatorship (although that would be great). Even a small group can clog the rotten corrupt system and bring it to its knees. Plus – aside from a few hotheads I have to question how much heart law enforcement will put into this. No one really likes doing someone else’s dirty work.

    If DeBlasio and Cuomo are smart (a dubious proposition) they will make a big noise to deceive their loudmouth lefty backers while beating a quiet retreat and let the citizens get on with life.

I am so surprised. ige has destroyed our State and is proud of it.
I hear very strong rumors from the left that this entire matter was orchestrated by Pelosi and she is in California calling in talking points and direction to destroy the economy so Trump is defeated. …And the reason I hear these rumors is fear among Democrats that there was never a card to play here. People are angry..and not at Trump.

    notamemberofanyorganizedpolicital in reply to puhiawa. | May 26, 2020 at 1:11 am

    Coronavirus Fifth Column

    By Eileen F. Toplansky

    As left-wing Democrat-controlled states continue to keep people in lockdown, it is becoming apparent that they are using the pandemic as a means to gain ultimate control of people’s lives.

    In fact, leftists the world over are exploiting the pandemic in order to create their alleged utopias. Vanessa Vallejo, a Colombian activist and columnist explains that

    Whenever they come to power, communists work hard to create a clientele network that will vote for them and support them in the future. So instead of looking for real solutions to lift people out of poverty altogether, they offer them subsidies or useless jobs where citizens are dependent on politicians. At the same time, they make life difficult for entrepreneurs, resulting in more and more unemployed people who can be hooked into their clientele network. Many of them will not be able to get subsidies, but plunging them into poverty will make them easy prey to convince so long as the government offers them aid and blames right-wing entrepreneurs and politicians for their misery.

    Sound familiar? This is happening all across the United States. The governors of states like Michigan, New York, New Jersey, California, and Pennsylvania continue to hold people hostage to their dictatorial impulses.
    Eric Levitz at Intelligencer can barely conceal his glee as he writes

    Now, the world is besieged by a pandemic that threatens to kill 100,000 Americans if we’re lucky [emphasis mine] before triggering a global economic depression.

    He believes that the COVID-19 pandemic has “expanded the spectrum of imaginable futures and political possibilities. And some of those possibilities have been a sight for sore socialists’ eyes.”

    Read more:
    Follow us: @AmericanThinker on Twitter | AmericanThinker on Facebook

There will be no loss in property tax revenue for the city, it will only be delayed. Properties will be aggressively seized and sold to recover the taxes, and many will reap a windfall buying at tax auctions.

What they might lose is sales taxes on commercial leases, should a bunch of commercial tenants leave the city resulting in zero tax revenue while their replacements are sought, plus lower ongoing taxes should their leases be significantly cheaper than before.

As NYC is a Schist hole,WGAF.

Since other areas are opening up in various stages, it will be interesting what the Wuhan virus statistics look like in those places in another week or two.

BigHairTsunami | May 26, 2020 at 11:05 am

Half of NYC does not speak English. The point of flooding NYC with foreigners was for perpetual eternal Democrat votes. New sucker found every second, motto of NYC. Fools from around the world spend all of their savings in a year or two in NYC. Then return home broke or move to generous welfare states like Minnesota. NYC will never change. It has access to 7 billion idiots with a dream of living in the concrete jungle.

Collapsing into the arms of socialism. Who could have ever predicted electing a Marxist mayor would end this way? Oh well, as RINOs like to say: “No one is perfect”, “Perfection is the enemy of the good.”

BierceAmbrose | May 26, 2020 at 10:40 pm

Well, I’m happy to see the NY State racket, n particularly “downstate” on the rack a bit.

And I’m sad and appalled that the distress lands almost entirely on folks who aren’t part of the cabal. Exactly as the fallout from downstate’s self-righteous posturing lands on, well, if we’re talking state actions, upstate NY. Although they do work hard to screw things up nationally, too.

I’m curious how this will play out. They’re all in, no matter the cost, unless it costs them. Notice how they squealed n continue to at the cap on state tax deductions.

— Hey, if what you’re paying is doing so much good, why isn’t it a good deal without the deduction?

— I thought we liked “progressive” taxation?

— Hey, y’all been trying to go after people with capital; this does that, so what’s bad here?

It’s not so much fun when The Virtue Signal lights you up. The thing is, to expropriate respirators — er, I mean money — from upstate there needs to be some there. So, to solve their financial problem on the back of the rest of the state, they’ll need to let the rest prosper some.

Or maybe not. They’re extremely clever.