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March 2, 2019

Open letter to Amazon

Today the Partnership for New York City took out a full-page ad in the New York Times with an open letter to Amazon chief executive Jeff Bezos, asking him to reconsider the decision to pull out of NYC. The letter was signed by a long list of prominent leaders in the city. Here is a copy (a PDF version can also be found, here):

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February 24, 2019

Airbnb empire comes to an end in NYC

At the beginning of this year, the City of New York filed this lawsuit in an attempt to shut down an Airbnb business that has supposedly generated around $20 million in revenue since 2012. It is currently illegal to rent out an apartment in most buildings in the city for less than 30 days unless the owner/permanent tenant is present. And that's not how this business was being operated.

Here are the locations of the rentals named in the lawsuit (map from the New York Times):

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The defendants include a real estate brokerage, the three partners behind the business (more on them here), as well as others. NYC has been trying to pass legislation that would force Airbnb to disclose more information to the Mayor's Office of Special Enforcement. Information such as the full name(s) and address(es) of every host and whether the short-term rental is an entire dwelling or a room. That presumably would have helped here.

For more on the lawsuit and the backstory, click here.

You may also find it interesting to go back to the five-point plan that Airbnb put forward back in 2016. It was intended to serve as a framework for new short-term rental legislation. The points make a lot of sense.

February 14, 2019

Is this just how the game is played?

As I am sure you have all heard, there's a lot of debate in New York right now (city and state) about whether they should reject Amazon's decision to open up a new headquarters in Queens.

Urbanist Richard Florida has been arguing that one of the richest companies in the world shouldn't be receiving taxpayer subsidies and that Amazon should do the right thing here. They should open up in New York but without any inducements.

As a counter argument, Kenneth Jackson, professor of history at Columbia University, recently opined that this is actually business as usual. American cities have a long history of competing for companies because the benefits outweigh the costs over the longer term.

Here is an excerpt from his op-ed in the New York Times:

They are right about one thing. It is absurd that any city would agree to such a deal. But this is how the game is played. Paying companies to relocate has been the American way since 1936, when Mississippi established the nation’s first state-sponsored economic development plan. Under that plan, since followed by many other jurisdictions, cities and states agreed to pay companies to relocate by promising them new factories and low or nonexistent taxes. With those inducements, numerous businesses relocated in the decades after World War II, usually from the union-dominated Northeast and Midwest to the business-friendly South.

Perhaps this would make a good debate topic for Kialo.

Update: Amazon just cancelled its plans for a corporate HQ in NYC.

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Brandon Donnelly

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Brandon Donnelly

Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.

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