By Kira Bindrim

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Published: October 31, 2007

Local 32BJ is asking he Realty Advisory Board for wage increases that it says are necessary given strong growth in the real estate industry.
The union representing 26,000 commercial office building cleaners at more than 2,000 of the city’s buildings rejected a contract offer from building owners, saying the proposed wage increases don’t keep pace with a booming real estate industry.

Negotiations between Local 32BJ and the Realty Advisory Board, lasted less than 30 minutes, according to the union, which initially presented its own proposal to RAB on O ct 24. The Realty Advisory Board comprises commercial building owners, managers and cleaning contractors. The two sides will return to the table Nov. 13.

As part of its proposal, Local 32BJ is asking for wage increases that would parallel what it calls a significant upturn in the real estate market, including a 26% spike in Class A office rents over the past year.

But although citywide rent increases are expected to continue through 2011, the pace of growth is slowing. Commercial rents at Manhattan buildings averaged $62.91 a square foot in the third quarter, up 6% from the previous quarter, according to Cushman & Wakefield Inc. That’s compared with an 11% increase between the first and second quarters of the year.

“With the real estate industry booming, the time has come for building owners to provide real wage increases to the hard working men and women who keep their buildings clean, safe and running smoothly,” said Local 32BJ president Mike Fishman in a statement. “Low wage workers should not suffer as the industry flourishes.”

Mr. Fishman said building owners generate over $20 billion a year in revenue, while labor expenses represent only 5.6% of their total costs.

Failure to reach a new contract by Dec. 31, when the current one expires, could lead to a strike at city buildings that include the World Financial Center, the Met Life building and the Empire State Building.

Local 32BJ briefly authorized a strike during its previous negotiations in March 2006. The action was averted when the two sides reached an agreement a month later. Apartment building workers last went on strike 16 years ago, staging a 12-day walkout.

Jim Berg, president of the Realty Advisory Board, was unavailable for immediate comment.

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