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Longtime Chelsea Businesses Forced Out by New Landlord, Tenants Say

By Mathew Katz | June 12, 2012 1:57pm | Updated on June 12, 2012 4:08pm
Manollo Castillo and William Narcado have cut hair in their shop on Ninth Avenue for 17 years, but have to be out of the space by the end of June, they said.
Manollo Castillo and William Narcado have cut hair in their shop on Ninth Avenue for 17 years, but have to be out of the space by the end of June, they said.
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DNAinfo/Mathew Katz

CHELSEA — For over 17 years, Jerry Gorman has gone to the barbershop across the street from his Fulton Houses apartment each month to get a trim.

Gorman, 74, who uses a wheelchair, is grateful that the New Barber Shop at 124 Ninth Ave., near West 18th Street, is just a short trip away.

But that's going to change in just a few weeks, when the shop's co-owners William Narcado and Manollo Castillo will be forced to close up shop.

"My hair grows, not as much as it used to, but it does, so I need them," Gorman said after getting what could be his last haircut from Castillo recently. "I'll go to his house if I have to, but it will be a lot farther."

The barbershop is just one of several small business on the east side of Ninth Avenue, between West 17th and West 18th streets, that were shocked to receive a letter in January saying their tenancies would be terminated by the summer.

The terminations came after the building was sold to SPC 364 W 18 LLC and Stonehenge Management in December by its previous owner, the Fortuna Realty Group, which is owned by Morris Moinian, according to the Department of Finance.

Stonehenge and Fortuna did not respond to requests for comment.

"They [Stonehenge] just sent a letter, there was no explanation whatsoever," said Rocio Velazquez, who runs Velazquez & Tamara Dry Cleaners at 126 Ninth Ave. Her business, which employs much of her extended family, was bustling with customers coming from new residential developments in the area, but it still has to go.

Each business's lease with Fortuna expired at some point over the past two years, the tenants said.  They had been on a month-to-month agreement with Moinian and were under the impression that it would continue that way until the letter arrived. Tenants, many of whom currently pay around $3,000 a month in rent, said they were not given the option to negotiate new leases.

Some businesses on the block including a Moneygram check cashier, the New China restaurant and a bodega, have already shuttered. The remaining barbershop, deli, and dry cleaner will have to vacate the premises by the end of the month.

The shops, sitting directly across from the Fulton Houses, provides the complex's low- and fixed- income residents with basic, affordable products and services, as well as jobs for lesser-skilled residents.

"I don't know where to send them," said Miguel Acevedo, who heads up the Fulton Houses Tenants Association and is frantically trying to find affordable space for the displaced businesses.

"Everything that's popped up nearby, it's more expensive. So basically these people are going to have to walk two or three avenues or five or six blocks for their basic services."

Several business owners and residents said that the lease terminations are symptomatic of the rapidly changing neighborhood.

With Google's $2 billion offices, Chelsea Market's high-priced food, and the High Line just a few blocks away, Castillo said he viewed the neighborhood as pushing out the poor.

The 80-year-old barber charges $12 to $14 for a haircut and said that he's looked around for a new space in the area, but could not find anything he could afford.

"We're looking, but the rent is too much," he said, blaming recent gentrification in the neighborhood for increased rents of $9,000 and higher for a storefront.

"This neighborhood, it's changed — one way good, another way, not so good. Soon, it will only be for the rich and famous, that's all."

Acevedo's tenants association has done what it can to help the businesses relocate, including attempting to secure space for the barbershop at Chelsea Market and affordable space for the dry cleaner at West 25th Street and Ninth Avenue, so it can serve residents of the nearby Elliot-Chelsea Houses.

Acevedo has also floated a plan to give small businesses affordable space on the ground floor of the Fulton Houses.

"These days, the way this neighborhood is going, the only opportunity for small businesses is to open in the Fulton Houses," he said.

But for Velazquez, the move alone would present significant costs. Her giant, old-fashioned laundry machines will cost roughly $10,000 to remove from her current space, she said.

"We don't know what to do," she said. "We're afraid they might just shut us down anytime."

It's not immediately clear what will become of the spaces when all the tenants are out, though rumors have swirled in the neighborhood that they could soon combine to become a chain drugstore.

"There's a million of those all over the city, just look at Eighth Avenue," said one computer engineer, who declined to give his name.

The engineer, who moved into Chelsea less than two years ago and said he made a "healthy six figures," explained that he wouldn't shop at a Duane Reade or Rite Aid on the block.

"Just because I'm rich doesn't mean I like that," he said.

"Rich people love cheap Chinese food, too."

Editor's Note: The original version of this story incorrectly listed the owner of the properties as the Moinian Group, instead of Morris Moinian's Fortuna Realty.