Real Estate News, Information, Data and Insights for New York City Real Estate
Duane Reade Closes in Hell’s Kitchen
The Duane Reade store had been open at this location for 10 or 15 years. There are no marketing signs presently in the windows. This is a two floor space that previously was a restaurant or bar.
New York City Mayor Eric Adams and Manhattan District Attorney Alvin Bragg announced Tuesday that retail owners must evict tenants who sell marijuana without a license. New York plans to evict the tenants of a store selling illegal marijuana, Mayor Eric Adams and Manhattan District Attorney Alvin Bragg announced Tuesday. The shops in Manhattan that sell cannabis without a license face eviction, in addition to fines of up to $5,000 and confiscation of their products. According to the release, the Bragg office has already sent letters to more than 400 illegal smokehouses in the area. In the coming weeks, the DA’s office said it will begin notifying landlords that they must begin eviction proceedings — and may even issue its own eviction notices against tenants if landlords don’t act within five days.
“If owners and landlords do not initiate eviction proceedings against these delinquent tenants in a timely manner, or do not follow through diligently, my office is prepared to take over and pursue eviction proceedings,” Bragg said at a news conference. The city also filed four lawsuits Tuesday against East Village smoke shops for illegal sales and public nuisance, Crain’s reported. The landlords of the shops were also named as defendants. The city has issued 66 retail cannabis licenses to stores so far, and Bragg’s office plans to make it a priority to evict illegal shops operating near licensed stores, Commercial Observer reports. Only two so far – Housing Works Cannabis Co. at 750 Broadway and Smacked at 1 Bleecker Street are open.
Meanwhile, there are about 1,400 unlicensed shops selling cannabis in Manhattan alone, said Borough President Mark Levine. “You can’t just open a store and sell marijuana,” Adams said. “There are rules and we have to actually follow them.” The threat of shop leases is the city’s latest attempt to crack down on illegal smoke shops. NYC launched a task force late last year that visited 53 stores over 11 days in late November and early December, but later inspected only five the City reported. Both shops revisited by the task force were full of illegal cannabis between inspections. Although this latest effort is focused only on Manhattan, Adams said the borough plans to share the results of the program with other districts. “We want to give New York’s legal cannabis market a fair chance to succeed,” Bragg said. “I hope to see full cooperation between building owners and commercial property owners to implement this education and criminal justice strategy.”
Upon examination of data compiled by Miller Samuel for Douglas Elliman indicates that the number of apartments sold in Manhattan dropped by 28.5% in the fourth quarter of 2022 compared to the fourth quarter of 2021. The average price for a Manhattan apartment is approximately $1.5M with the median sales price dropping by 5.5%. According to the Douglas Elliman and Miller Samuel data, the number of sales in fourth quarter 2021 totaled 3,559 compared to 2,546 in fourth quarter 2022. CNBC reported, “The declines in both sales and prices mark the end of the roaring comeback in Manhattan real estate after the worst days of the pandemic and raise fears of continuing weakness into the new year. Rising interest rates, a weaker economy and a falling stock market, which has an outsized impact on Manhattan real estate, are all likely to weigh on the market this year.”
On Thursday, December 30, 2022 several smoke shops were raided in Hell’s Kitchen. Police left one store with several clear bags and loaded a police van. Stores that were not raided quickly closed for the evening.
The City reported on New York City Patch.com:
On Thursday evening, about two and a half hours after the Housing Works store opened its doors, a journalist with THE CITY happened to see city Sheriff’s officers, accompanied by NYPD officers, raiding a store on Ninth Avenue off 45th Street and leaving with trash bags full of merchandise.
The Sheriff’s Office, which operates as the enforcement arm of the city’s Department of Finance, has been at the forefront of the city’s limited enforcement efforts. The NYPD has taken the position that it is not allowed to enforce licensing violations from stores openly advertising their wares unless they directly witness a sale.
On Friday morning, New York City Sheriff Anthony Miranda sent a statement saying that “The Sheriff’s Office in partnership with OCM and NYPD continues to conduct inspections of illegal operations seizing all illegal and unlicensed products. These locations continue to present a public health and safety problem for our communities.”
These photos were taken along Ninth Avenue Thursday night, December 30, 2022 by ManhattanReal EstateTracker.com.
Walking the streets throughout Manhattan you’ll see new convenience stores, smoke shops and stores that sell only cannabis-related products opening everywhere. These businesses are thriving at least for the time being. The stores are typically under 1,000 square feet and they usually open one store on a block but there are blocks that have more than one store – in some cases on the same side of the street. “Smoke and Vape” has been open on 9th Avenue in Hell’s Kitchen for years but this past week, “The Forbidden Cannabis” has opened a few doors north on the same block. Many stores sell soda, juices, pipes, etc. in addition to cannabis. The new store that opened last month on West 42nd Street and 9th Avenue, “The Green Light District” sells only different forms of cannabis and CBD.
The future of these new stores will ultimately be in the hands of the New York State Marihuana Regulation & Taxation Act (MRTA) which was signed into law on March 31, 2021 legalizing adult-use cannabis (also known as marijuana, or recreational marijuana). The legislation created a new Office of Cannabis Management (OCM) governed by a Cannabis Control Board to comprehensively regulate adult-use, medical, and hemp cannabis. The OCM will issue licenses and develop regulations outlining how and when business can participate in the new industry.
According to OCM, there will be 22 new licenses granted in Manhattan. A breakdown of the number of conditional adult-use retail dispensaries (CAURD) indicates that up 150 licenses will be award across 14 regions of the state, with most licenses in New York City and Long Island.
OCM states that the primary goal of the CAURD license is to create opportunities for New Yorkers harmed most by the prohibition of cannabis by granting up to 150 CAURD licenses to individuals who themselves, or their close family members, have had past eligible cannabis-related offenses and have ownership stakes in profitable businesses.
The New York Post reported that OCM spokesperson Aaron Ghitelman said that the newly opened unlicensed dispensaries “are illegal as there are no licensed adult-use cannabis sales at this time in the State of New York and we will work with our partners to enforce the law.” OCM has sent out more than 50 cease-and-desist letters, which warn shops that “any unlicensed sale of cannabis is illegal” and that “failure to cease this activity puts your ability to obtain a license in the legal cannabis market at substantial risk.”
It will be interesting to see how the city and state regulates the selling of cannabis products over the next several months.
Inflation data released by the Fed today indicates that the consumer price index or CPI continued very high at 8.2 percent in the year through September. When you remove the price increases for food and fuel, prices increased 6.6 percent. The Federal Reserve will continue to raise interest rates to try to control and bring down inflation. Inflation levels are running at 40 year highs and has been responsible to the large downturn in the stock and bond markets.
The monthly inflation data indicated that overall inflation rose 0.4 percent in September which was 0.3 percent higher than in August 2022. Inflation began to rise in January 2021 and has continued now at 40 year highs. Central bankers are expected to continue to raise interest rates which will essentially slow the economy but may also create a recession. Interest rates have been raised five times this year so far.
The new high inflation rate will likely confirm a three-quarter point increase to interest rates in November and even in December 2022.