| ▲ | throwaway85825 2 days ago |
| When commercial rents aren't artificially inflated it allows for a greater diversity of businesses. There are tons of businesses that could exist if the government wasnt so intent on running a plantation economy. |
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| ▲ | laughing_man a day ago | parent | next [-] |
| How are they artificially inflated? Do you mean through taxation? |
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| ▲ | epolanski 2 days ago | parent | prev [-] |
| I'm not sure what government has to do with it, it doesn't set the price of rents. Rents do get progressively lower in distressed areas because they are distressed, and higher in high demand ones, but that's not enough when less customers are entering your shops anyway. |
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| ▲ | throwaway85825 2 days ago | parent [-] | | Government adds mountains of red tape, taxes employers to death and has reduced the spending power of the median worker to below poland through its plantation migration policy. Commercial units sit empty instead of lowering rents because of the 'extend and pretend' in lending. The banks can't afford to revalue commercial real estate at the current market rate. It's like the 70s again. | | |
| ▲ | throwaway-blaze a day ago | parent | next [-] | | You are right that the units sit empty because the banks have loan covenants with the landlords that minimum rent is XX, which is higher than the unit is currently worth. It isn't so much extend and pretend, its landlord CANT lower the rent without violating their loan. If you get government involved, this will just get more expensive. We need to wait it out until the landlord can't pay the loan anyway and is forced to sell the building at a massive loss. Then the new owner will have a new loan with a new price floor and the dance can start over. | | |
| ▲ | Terr_ a day ago | parent | next [-] | | > It isn't so much extend and pretend, its landlord CANT lower the rent without violating their loan. IANAPropertyGuy, but IIRC the banks don't really want to foreclose on it anyway, because that means recognizing that they made losing loans and they don't want to have to figure out what to do with the building that can't be sold off for much. Hence strategically looking the other way when landlords off "first X months free" deals in lieu of an officially-lower rent. | |
| ▲ | electroweak a day ago | parent | prev | next [-] | | This is exactly the case. On my Canadian high street the redevelopments are either empty or exclusively high cost businesses. I looked at the rent arrears notice posted on one failed shop and the rate would exclude anything not a money mill. They'll be no lutiers or second hand bookstores in the shiny towers on my street. | |
| ▲ | cowlevel a day ago | parent | prev [-] | | What if you had a rental agreement where you pay $x for y% of the property but the landlord lets you use the whole thing and x/(y*0.01) > minimum rent? Or you pay minimum rent but your landlord gives you some of it back? Idk, there's probably room for creativity here |
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| ▲ | epolanski 2 days ago | parent | prev [-] | | [flagged] |
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