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“Sidewalk Sheds” and Your Restaurant- The importance of addressing the issue in your lease

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“Sidewalk sheds” are temporary structures built to protect people and property during construction. They are everywhere in New York City, and their numbers continue to grow.  Last year there were a total of 2,668 scaffolds and 5,846 sidewalk sheds according to the New York Department of Buildings, which was 25% more than in 2009.

 

To put that into perspective, if you took all the sidewalk sheds currently in New York City and lined them up end-to-end they would stretch 189 miles.

 

Sidewalk sheds have numerous negative effects on restaurants and small businesses in general; they reduce the accessibility and visibility and deter foot traffic.  One owner stated, “Clients walk right by and don’t even see us because it looks like we’re closed.”  Another estimated that sidewalk sheds cost him approximately 10 percent of revenues.  Another concern is if you have a sidewalk café, or plan to have a sidewalk café, then a sidewalk shed could greatly reduce the amount of seating available, and of course detract from the ambience.

 

These potential concerns are why it is important to consider the effects of sidewalk sheds at the onset of your venture and try to properly prepare yourself for the possibility during lease negotiations.  Although the Department of Buildings requires sidewalk sheds to be “removed immediately once construction, demolition or remediation work is complete,” this is not always the case; sometimes they can be up for, what seems like, an eternity.  For example, the sidewalk shed in front of the Milford Plaza Hotel on Eighth Avenue has been up for over six years!

 

Due to these problems and negative implications, as a tenant you must try to get the issue of sidewalk sheds and/or scaffolding in your lease, for example, rent abatement for anytime a sidewalk shed is in place.  This not only protects the leasee financially, but it also gives the landlord an added incentive to get the sidewalk shed down as soon as possible.

 

Additionally, try to set limits and constraints on the landlords right to put up a sidewalk shed. For example, limiting the duration and frequency a landlord is allowed to erect a shed or scaffolding.  You may also want to set minimum clearance standards, so the minimum height of the shed is as high as possible in order to allow the most natural light, and to make the storefront more visible and aesthetically pleasing.  Try to require that the sheds not block any windows or doors.  You also want language in the lease regarding if a sidewalk shed is erected, that the landlord will install signs for the tenant, similar in design and size to the existing; and that no other signs or advertisements would be allowed.  These are just some things to keep in mind when negotiating a commercial lease.

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