“The market determines the highest and best use. We know based on market conditions and the increase in the self-storage industry that there is a need for public self-storage both for families as well as small businesses,” says Stewart. “For the city or a commission to make a determination that a specific piece of property is better suited for industrial use as opposed to self-storage puts an unnecessary restraint on the use of property.”

Stewart also says the requirement will drive up the costs of self-storage. Although existing facilities will not be affected, the law will curtail additional development. “When supply goes down, then the cost of public storage is going to go up.”

A GlobeSt.com article covering the legislation when it was before the City Planning Commission noted that the Self-Storage Valuation Group at CBRE Valuation & Advisory Services reported New York City is the number one under-supplied self-storage market in the country. The August 2016 report identified San Jose, Los Angeles, San Diego and Baltimore as cities right behind New York in this shortage.

Stewart further notes with discretionary approval of the special permits, there's uncertainty in whether or not permits would be issued. Stewart represents clients in the self-storage industry but looks at this issue as a practitioner involved in real estate for almost two decades.

He says families, individuals and small businesses that can't afford larger warehouse space will be affected by the restriction. “It's important, if you're looking at property for development for self-storage either currently or in the future, you have to be aware of the zoning and what the implications are with the change in the law,” says Stewart.