Supersized Summer Issue!!

A permanent outdoor seating program is on its way, but this progress has the DOT out in full force looking for structures that are not in compliance under the temporary program. It is likely they are trying to clean up any loose ends while the emergency program is still in effect so that they have a smoother transition when it comes time to convert to the permanent program. As a result, technical violations that have been overlooked previously are now being strictly enforced and businesses are being threatened with termination of their authorization.

A lot of businesses have been trying to bide their time before making any changes, understandably holding out to see what the permanent program will look like.  Unfortunately, DOT isn’t acting like they want to give us that chance. BUT, there are still things we can do to try to get you more time even if you have received a Termination Notice.

If you have received a Termination Notice for your outdoor seating, don’t panic! Even after a Termination Notice has been issued, we can contact the DOT and seek an extension of time to address remediations. We can then work with you to gather the evidence needed to show the DOT that your space is compliant and advise you on any necessary changes.

If you have not received a Termination Notice, it is still worth it to give your space a closer look and make sure you are in full compliance with the Open Restaurant Program requirements.  This is especially true if you’ve received a Notice to Cure in the past—even if you think you reached an agreement with the DOT over any issues.  Even where businesses have thought they reached an understanding with DOT previously, those earlier Notices to Cure are being used to justify immediate Termination Notices.

Key takeaways: Don’t sit on any notices you receive from DOT. Get your space in compliance and review your outdoor seating for any possible violations. We are standing by ready to assist in assessing for necessary remediations and talking to the DOT on your behalf.

If you have any questions, please email Eric Dawson at [email protected].

Off-Premises Catering Licenses are Available!!!

Finally, the little guys, the start-ups, the hobbyists with dreams of more, will have the ability to apply for their own OFF-PREMISES CATERING LICENSES.  The NY State Liquor Authority has created an entirely new class of license – one specifically for caterers who do NOT have their own facility that can accommodate seated dinner service for 50 persons.  For the first time ever, New York State is allowing for a strictly off-premise catering license – one where your facility is very specifically not used for any on-site events.  So, if you are a caterer who has a commissary kitchen and office space, and the ability to prepare food for an off-site, 50+ person event, this license is for you.

We were anticipating this moment from the instant that our Governor made the announcement six months ago.  So we’re fully prepared, and our team is ready to help you apply.  This application has only been live for a few weeks, yet we’ve already onboarded a number of people.  Call us today if you have questions or if you think that this license is a good fit for you.

DOT Permanent Restaurant Program

We are all hearing about the future of outdoor restaurants, and there’s a lot of noise and confusion out there. So we broke it down for you so you can plan your future.

As a note, it is still not clear what the design guidelines will be for roadway dining structures; however, the NY Hospitality Alliance believes they will not allow fully enclosed structures while design guidelines for sidewalk cafes will likely mimic the pre-pandemic program.

• Sidewalk Café: There will be four sectors depending on your location in the city. Fees range from $6 per square foot for the lowest sector to $31 per square foot for the highest sector. Sectors 3 and 4 shall only include the area south of and including 125^th Street in Manhattan. Approximately 80% of restaurants would be classified as being in the lowest sector.
  • Sector 1: $6
  • Sector 2: $10
  • Sector 3: $18
  • Sector 4: $31
• Roadway Café: There will be four sectors depending on your location in the city. Fees range from $5 per square foot for the lowest sector to $25 per square foot for the highest sector. Sectors 3 and 4 shall only include the area south of and including 125^th Street in Manhattan. Approximately 80% of restaurants would be classified as being in the lowest sector.
  • Sector 1: $5
  • Sector 2: $8
  • Sector 3: $14
  • Sector 4: $25  

• Applications will no longer require plans to be drawn up by a professional architect or engineer.
• The required approval by the Landmarks Preservation Commission has been restricted by shortening the amount of time they must sign off on applications. The Commission shall decide on applications no later than 10 business days after receipt of a complete application, unless the Commission determines that such outdoor dining structures may influence the exterior architectural features of a landmark or building within a historic district and a public hearing is required.
• If a license holder violates any of the regulations for the first time, the license holder will be given a period of 30 days after notice to correct the violation.

• If the premises had a licensed outdoor café within the prior two years, new tenants will be able to obtain a temporary outdoor dining permit, provided that the plans for the café are the same as the one previously licensed.
• The second temporary permit will be for new applicants who do not have to wait the full amount of time to receive revocable consent and can get temporary permission to operate while their application is pending.

• Every business that currently has a permit under the emergency Open Restaurants program will be allowed to continue operating until their application under the new law is acted upon by the city. Such date will be within a “reasonable amount of time,” but no less than 3 months after the effective date of such rules.
• Any business that had operated outdoor dining pursuant to the emergency Open Restaurants program, whose structures are noncompliant with the rules of the department relating to design, shall remove such structures no later than 30 days after the determination of the department to approve or deny revocable consent. All such structures must be removed no later than November 1^st, 2024.

• The SLA is still experiencing incredible delays with respect to processing times of just about every type of application.  The sooner you start the process the better.
• On average, the SLA is taking about 7-8 months to process new On-Premises license applications – regardless of location or type. Add an extra 1-2 months if the community board opposes the application.
• Look for “key money” deals; look for places with a clean license history; look for spaces that might otherwise qualify for temporary permits.
• On average, we are seeing a current wait time of 10-12 months for new off-premises retail liquor/wine store applications.
• All types of change applications (ownership, method of operation, etc.) are taking a minimum of three months.  If the change is more complex, it will take even longer.

One of the biggest headaches our clients face when building out a new space is keeping their GC on time and on budget. Problems during the buildout can just eat up your budget and cause way too much stress. So, we have started getting involved in GC construction contracts.

Helbraun Levey’s Real Estate Group is pleased to announce that we are now offering our clients a specialized service of reviewing and negotiating construction agreements. Your contractor may be telling you that your construction agreement is non-negotiable – that is incorrect. There are key points that should always be reviewed in order to avoid unexpected expenses down the road and keep your build-out on track. A few issues that our clients most commonly run into trouble with (and that you should be keeping in mind) include the following:

• Payment Schedule – The schedule of payments should be as specific as possible, including payment amounts and conditions to be met so that there is no confusion on the back end. We often recommend that the contractor be paid in thirds – 1/3 up front (so that the contractor can purchase materials and hire subcontractors), 1/3 at the “halfway point” (which designation should be agreed on by the parties), and the final 1/3 when the job has been substantially completed with only punch list items remaining.
• Scope of Work – Make sure that your contractor has a clear understanding of all of the work to be done, the materials to be included, and exactly how you envision your space looking at completion of the build-out.
• Project Schedule – The work schedule should be set out in detail, including the start and end date, working hours, and milestones to be met. Including strict penalties for failure by the contractor to meet deadlines is a good way to make sure your contractor works efficiently.
• Change Order Protocol – Changes to your plans are bound to happen, so it is important to anticipate them with a plan in place. Before your contractor can initiate any changes, they should provide to you for your approval a written description of the cost of the new work and its impact on the schedule.
• Lien Waivers – A lien waiver is an agreement not to place a lien on property. Your contractor should be required to provide lien waivers from subcontractors and materials suppliers stating that no liens will be placed on your property in the event that the contractor fails to pay amounts owed.

Our Real Estate team is here to help you save money on your build-out by getting out in front of these potential stumbling blocks. If you have any questions, email Jared Wiesel at [email protected].

Event season is in full swing and if you’re hosting or catering events, you should pay careful attention to your lucrative event contracts so you can squeeze as much out of them as possible.

We’ve seen our clients get burned by hosts who want to cancel events at the last minute, hosts who refuse to pay you for services, hosts who bring in too many caterers only to create logistical mayhem, hosts with creative interpretations of ‘Force Majeure’ clauses…you name it. Fortunately, most of these headaches can be avoided by establishing clear rules and parameters in your catering and event contracts.

Some tips for your catering contract as you gear up for events this Summer and Fall:

• Attach sample menus, and require advance notice of any guest food allergy;
• Include exclusivity provisions;
• Require an anticipated guest count, and cap the guest count;
• Disclose all fees clearly, and consider including contingent overtime fees;
• Require an upfront and nonrefundable deposit to reserve the event date;
• Impose cancellation fees which scale based on the timing of a cancellation relative to the event date. Note that for catering contracts, cancellation fees must approximate the amount of actual costs incurred in reliance of the given event;
• Pay special attention to your “Force Majeure” clause – if an event cannot be held due to an event outside the parties’ control, explicitly require that the parties make good faith efforts to reschedule the event on the same or substantially same terms. Remember, a Force Majeure clause is not a ‘get out of the event for free’ clause;
• Include provisions relating to service of liquor and related liability;
•  Reserve the right to eject guests who misbehave;
•  Include provisions disclaiming warranties and establishing caps on potential liability.

If you have any questions about your catering/event contracts, or if you’d like to have us polish them up for you, don’t hesitate to email Andrew Fine at andrew.fine@helbraunlevey.com.

Many restaurateurs get inspired by their summer travels and want to explore options to expand both inside the U.S. and internationally. Our clients are opening shops in the Hamptons, Cape Cod, Paris and London, just to name a few!  If you are considering expanding or launching your brand domestically or internationally, it is crucial that you have your trademarks registered and protected.

Whether it’s a State, Federal or International trademark you are seeking, the steps are the same. We will first conduct a trademark clearance search to make sure that your trademark is not only available, but also has a high chance of successfully achieving registration.

Once the trademark search is complete, we will prepare the trademark application and file it with the appropriate State, Federal or International trademark office. Understanding that you will want to move quickly, we can get your application drafted and filed within one week from the trademark search results! After trademark applications are filed, we advise that you use the TM symbol to alert members of the public that you are asserting rights over the name and offer you additional protection against potential infringers.

Keep in mind that U.S. trademark applications are averaging one year from filing to registration, European trademarks are average four to five months from filing to registration and New York State trademarks are taking around three to four months (other State applications will vary). So, if you want to lock down that perfect name, do yourself a favor and dive right into the process so that you can have your trademark registered sooner rather than later!

If you have any questions about trademarks, email Hamutal Lieberman at hamutal.lieberman@helbraunlevey.com.

There’s a Rat in the Kitchen…

NYC plans to issue a new rule to keep rats away from garbage by requiring restaurants to put trash in containers instead of bags that sit at the curb for hours each night.  The rule would apply to a wide range of businesses that produce most of the city’s food waste. Restaurants will be required to put trash at the curb in “rigid receptacles with tight-fitting lids.”  The rule could take effect as early as July, 2023.

And here’s a little pitch from HL client Josh Blackman, who is in the real estate biz and happens to make these storage bins:

An attractive solution to trash storage is BrownstoneBin, a rat-proof and very durable all-aluminum trash container.  BrownstoneBin can handle an unlimited number of trash/recycling cans and looks much better than rows of garbage cans.  BrownstoneBin is available for purchase and on a rent-to-own basis.  Contact BrownstoneBin: https://brownstonebin.com/contact-us/

R.I.P. – The fabulous and incomparable Tina and one of my literary faves and fellow Brooklynite, Martin Amis.  Simply the best.

As Jerry and the Boys say: Enjoy yourself if just because, it’s later than you thought it was.

Take care and enjoy!

David