When Ground-Floor Retail Sticks Out Like a Sore Thumb Some Commercial Tenants Can Bring Aggravation to Residents

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In many cases in which a residential condo or co-op property includes street-level commercial space, the retail tenant leasing that space is a good fit with the apartments above. Whether it's a supermarket, an apparel business, a sporting goods store, or a salon, that ground-floor vendor (or vendors) can be a boon to the community -- it may actually add value to those who live above it and frequent the shop(s).

But in some situations, things don't mesh as seamlessly. Certain types of commercial tenants can bring aggravation to residents subjected to an array of sensory assaults sent their way. Bars and restaurants can bring noise at all hours of the night, not to mention smells that may not only be pungent, but can attract vermin as well. Gyms can be a literal headache for anyone working at home when that spin class is happening downstairs. And any popular retail tenant that attracts lots of foot traffic can also bring with it concerns about crowds and loitering, which no resident wants to contend with while they're just trying to get into their home.

Bottom Line

“What typically happens in a lot of offering plans is the sponsor or developer either keeps the retail for themselves and rents it out, or they plan to sell it to an investor,” explains Stephen Elbaz, President of Esquire Management in Brooklyn. “In either case, they write that offering plan in a very liberal manner such that the commercial unit owner retains many rights, which can cause problems with residents.”

Jay Cohen, Vice President and Director of Operations at New York City property management firm A. Michael Tyler Realty Corp., relates an ongoing situation that reflects the conflicting interests that can arise when commercial and residential space occupy a single property:

“A restaurant or bar moves in, and now there are sound issues late at night because they're playing music after 11 p.m.," he says. "The bass is booming, and the residents' quiet and peaceful enjoyment is being disrupted. So they look to the board to handle the issue -- but how do you go after a commercial tenant when they're just trying to operate their business? So we call in an acoustical engineer to measure the decibel levels at certain times during the course of the day. And once we see the report, the board will have to take action against the commercial tenant -- most likely by attempting to force them to take corrective measures, including the installation of soundproofing material, or even closing up shop an hour or two earlier.”

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