NEW YORK CITY—For this month’s edition of the Full Nelson, I sat down with Jessica Walker, president of the Manhattan Chamber of Commerce, to discuss what the chamber does and how they are helping local businesses in Manhattan.
James Nelson: What is the mission of the Manhattan Chamber of Commerce? Who does your membership consist of?
Jessica Walker: Essentially, we are a community of businesses who are trying to help each other. We are a membership organization comprised of solo entrepreneurs, long-time neighborhood businesses, startups, mid-sized businesses, and the large corporations, the Googles, Microsofts and banks of the world. The three things that we really focus on are, one, we are a thought leader on the future of the city’s economy. We do a lot of advocacy work, we are the voice of business, trying to make sure that policies and legislation that is passed is in the interest of business. Two, we are a super connector. We bring all those businesses together. We are a platform to help them do business deals and really work together, strategic partnerships in that way. Then third, we are also the guardian of small businesses and startups here in the city making sure that they are able to start and thrive and get the education they need to do well here.
Nelson: I know the chamber is not a government organization, and yet, you have a lot of interaction with government. Are you mostly interacting with local politicians? Who are you interfacing with to advocate for the business community?
Walker: We do a lot of advocacy on all levels of government to protect the businesses here in Manhattan. We are local in that way, but really it is Manhattan. We are a global city, so everything we do really does have wide-spread ramifications. We work with government in several ways. The two biggest ones are the advocacy, as I mentioned. As policies come up, legislation, we are going to be there to make sure that the voice of business is heard and the interest of business is served. Second, we are actually a partner. For example, we have a government contract currently with the city that helps us deliver services directly to shops and stores. We have staff members that go into restaurants and shops to find out what they need, how we can be helpful, and connect them to help. It’s great.
Nelson: There are other chambers throughout New York City, some at the local levels, some by borough, and there are also several business improvement districts. How many of these organizations are there? How do they work together?
Walker: Some of it is New York. We are very complex. There are several organizations that have a similar mission and, of course, we want to partner wherever we can. For example, there are chambers like ours that are focused on all of the respective boroughs. We are the Manhattan Chamber. There is one in Brooklyn, one in the Bronx, one in Staten Island, and one in Queens. We come together as the Five Borough Chamber Alliance around some issues, usually in city-wide advocacy issues. We recently just did an awards show to highlight the minority and women-led businesses in each of our respective memberships. We work together in that way.
The BIDs are the Business Improvement Districts, and they are hyper local chambers that focus on one community in the city. We partner with them a lot of times with advocacy because they are the ears and eyes of what is happening on the ground, so they actually give us a lot of information and we have the banner and the platform to go forth and try to help those businesses. It is a great relationship we have.
Nelson: How would you describe the overall business community right now in New York City? Are we a friendly place to do business?
Walker: New York is a tough town. That is what I always say. There are many complexities, lots of competition, a very costly city, obviously taxes and fines and what not, but it is a value proposition. We also are the best city in the world. We attract the top talent. There are quite a few reasons why a business would want to be here. The work that we are trying to do is to make sure that, that value proposition remains, so businesses and talent still want to be here and keep this the best place in the world.
Nelson: Retail on the whole has had a real struggle. Most of the major retail corridors have over 20% vacancy and ecommerce is certainly setting up a challenge. What can the chamber do to help support that and turn that around?
Walker: This is a major issue, a major concern, especially in Manhattan. I think there are several things at play here. One is the retail sector itself is undergoing significant transformation as they are trying to compete with online retailers and just all the technological changes that are taking place. I think a lot of people are trying to get their bearings right now. There are several retail stores who have decided to move away from brick and mortar and go more towards online. There are some, like the Starbucks of the world, that are taking a pause. They are not necessarily pulling out of the city, but they are not necessarily growing either. Then you do have some of those, like the Targets of the world, who are doubling down and wanting to move into New York. In fact, Target just announced that they are going to be moving to 34th Street. I think there is a lot of equilibrium. They are trying to just figure that out.
Additionally, I think developers in general, have been sitting and waiting. As you know, commercial leases are usually very long, 10 years or more, and so they want to hold out for the best deal that they can get. Everybody is trying to get their footing. I think that there is definitely a profit to be made, but it might not be the way that it was two or three years ago. Folks are trying to figure that out.
Lastly, the small businesses of the world, the neighborhood businesses, are trying to hang on. Those that have been around in neighborhoods where the rents are going up around them, they are trying to figure out a way to stay. The chamber tries to help those folks to be more competitive, find ways to up their marketing. What are the things that they can do to be more competitive and remain? That is really where we have been weighing in. I feel like there is so much hope here. It is all going to get figured out. Always bet on New York.
Nelson: I know you have been a big proponent of eliminating the commercial rent tax. Can you tell us more about what it is and why it should be repealed?
Walker: This is a very onerous and unfair tax, essentially, that a lot of commercial renters have to pay in Manhattan. It started out in the 1960s as a revenue generator for the city. It actually applied to commercial renters throughout the city, but over time, it got peeled away and it no longer applies to the outer boroughs. Currently, it is only for commercial renters in Manhattan south of 96th Street, so already it is unfair because it is geographically targeted. We also think it is very unfair because rents usually include property taxes in them, so this is a tax on a tax.
The issue though, is that it raises a lot of money for the city, which is why it is so hard to get rid of it. It raises over $700 million per year, so it is a big deal, but what we have been trying to do is target relief to particularly the small businesses in the city who can least afford it. The irony is that the higher your rent goes, the more tax you have to pay because it is based on your annual rent. Currently, businesses who pay $250,000 or less are exempt from the tax. What we would like to do is see that threshold lifted to $500,000 or less, so they are exempt. We would like to see it phase out altogether.
The other issue is that as rents go higher and higher, it is capturing more of those small businesses. Again, this is about targeted relief. I think we have a very good chance of trying to get something in the city budget, which is what we are pushing for with many of our partners here in the city.
Nelson: How can our readers help support the chamber? How can they get involved?
Walker: Many ways! There are many things that we are trying to do. We are launching new programs all the time to support businesses and, of course, we do a lot of networking events. The best people can do is go to the website at ManhattanCC.org. It will tell the story of everything we are trying to do. Folks can join and become members if they would like, or they can just check out our events and come through that way.
Also, we recently launched a help desk to provide businesses with all the help that they need on issues, challenges, questions, anything. They can reach us through email at helpdesk@ManhattanCC.org.