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09.06.19, 19:17 PM New York City
30 replies
So many storefront businesses are empty all over the city. I've read it's something like 20%. I odn't understand why. Wouldn't landlords make more money renting it at a lower rate than letting it sit empty for months and years? How does this bring them a profit? Healthy local businesses are forced to close because of high rents (I've asked the storekeepers) - so it's not just the Amazon effect. Can real estate companies inflate the rent and then take the inflated rent that no one will pay and list it as a loss? [ Reply | Watch | Flag ]
New York City 09.06.19, 07:17 PM Flag
 

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They get a tax break for the loss. It’s not a hardship for them. [ Reply | More
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General Topics 09.06.19, 07:17 PM Flag
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Although there is a push for a vacancy tax that would encourage landlords to lower rents. [ Reply | More
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General Topics 09.06.19, 07:19 PM Flag
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I would be in favor of this. [ Reply | More
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General Topics 09.06.19, 07:32 PM Flag
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I think this would be great and that the foreign owners pay a bigger tax since they are not here to see how it ruins the community. [ Reply | More
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General Topics 09.06.19, 07:46 PM Flag
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Get a clue! Many of them have loans and have to come out of pocket to pay them. [ Reply | More
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General Topics 09.06.19, 07:31 PM Flag
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I didn’t know this [ Reply | More
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General Topics 09.06.19, 07:40 PM Flag
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There is no tax break for the loss, what are you talking about? You don't get income, so you don't pay taxes on the income you didn't get but how is that a tax break? [ Reply | More
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General Topics 09.06.19, 08:08 PM Flag
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It's a leverage move. Not a tax move. If they can say the commercial rent on a building is 20k, they can borrow against that. It doesn't matter that no business is actually in that space or willing to pay 20k for that space. [ Reply | More
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General Topics 09.06.19, 08:22 PM Flag
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It's one more way in which real estate interests are ruining New York City. [ Reply | More
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General Topics 09.06.19, 07:22 PM Flag
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One of many!!! [ Reply | More
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General Topics 09.06.19, 07:27 PM Flag
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Actually it is reflective of a terrible national retail market. Now that everyone buys stuff online retail storefronts are no longer viable. Landlords are unwilling to accept the lower rental rates that are a result of the reduced demand. Often because the income produced at the lower rates implies a value of way less than they paid for it. Eventually lenders will foreclose and sell and with reset bases new owners will rent out at the new market rents. This doesn’t happen overnight but we will get there. [ Reply | More
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General Topics 09.06.19, 07:33 PM Flag
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Landlords are increasing rents by large percentages when leases expire in NYC--far beyond what what the market will support. That's why businesses can't renew their leases. [ Reply | More
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General Topics 09.06.19, 07:42 PM Flag
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This was ten years ago. Now they moved in national retailers and higher end tenants who couldn’t justify the store front. So many retail bankruptcies nationwide. Get a clue! [ Reply | More
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General Topics 09.06.19, 08:08 PM Flag
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These aren't mom and pop owners with empty store fronts. They are usually big companies and they get loans based off of inflated rental prices and use that to buy or build new buildings. [ Reply | More
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General Topics 09.06.19, 08:24 PM Flag
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I am in this business. If the property Plummets in value the lender will be taking it back. I know it is not mom and pop. Retail is a very out of favor asset class in real estate investing right now. Lenders actually do pay attention and don’t make loans off inflated rental assumptions. Lender are focused on their debt yield and the debt service coverage ratio of the asset. [ Reply | More
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General Topics 09.06.19, 08:28 PM Flag
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That would make sense for new stores in new buildings. But there are many stores in old buildings who still have plenty of customers but the landlord jacks up the rent and they have to move out. Yes, there may be a poor retail market overall; and new buildings may be overvaluing their commercial spaces; but neither fact explains why a landlord would rather get $0 instead of the $8,000 (or whatever) he's been getting. [ Reply | More
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General Topics 09.06.19, 11:44 PM Flag
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Lots of interesting articles in the NYTs on this. [ Reply | More
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General Topics 09.06.19, 07:23 PM Flag
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They don't explain it, either. [ Reply | More
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General Topics 09.06.19, 11:46 PM Flag
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Totally. That’s why I come to UB. To learn what NYT can’t explain. [ Reply | More
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General Topics 09.07.19, 02:14 AM Flag
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It's not impossible that someone here would happen to know. For instance, the NYT knows less about schools than UB does. [ Reply | More
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General Topics 09.07.19, 03:56 AM Flag
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Our councilman in Brooklyn has been working on this. Some landlords agreed to permit pop-up places. Sadly right now, we have a glut of nail salons on one of our avenues. Service type stuff appear to have longer survival rates - like salons, restaurants, bars and liquor stores. Everything else is a risk considering the high rents. [ Reply | More
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General Topics 09.06.19, 07:24 PM Flag
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Gold rush mentality in NYC! That'd what happens. Poor buffalo. [ Reply | More
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General Topics 09.06.19, 07:31 PM Flag
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Buffalo used to be vibrant? [ Reply | More
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General Topics 09.06.19, 07:41 PM Flag
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Yes. Why did Frank Lloyd Wright build so many homes? And Stanford White? And Louis Sullivan? And Frederick Law Olmstead designed the park and parkway system? [ Reply | More
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General Topics 09.06.19, 07:47 PM Flag
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NP: when I was growing up, Buffalo always seemed to be in the public conscious as a major U.S. city. Funny how you rarely hear about it now. [ Reply | More
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General Topics 09.06.19, 07:51 PM Flag
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and that Richardson asylum! [ Reply | More
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General Topics 09.06.19, 08:05 PM Flag
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I was thinking the same thing, stores on first and 2nd Ave. have been empty for years. [ Reply | More
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General Topics 09.06.19, 07:39 PM Flag
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Two are closed on my block. It makes the neighborhood look awful. [ Reply | More
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General Topics 09.06.19, 08:11 PM Flag
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If the companies are not getting loans using inflated imaginary rents, then why are they raising rents beyond market value and ending up with nothing? That's what I don't understand. HOw is this better for them than letting the shoe repair or dry cleaners or diner stay with a lower rent hike? [ Reply | More
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General Topics 09.06.19, 11:48 PM Flag
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I read an article that said some of it is due to zoning and what’s allowed to go up. Part of the issue on Canal Street, for sure. [ Reply | More
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General Topics 09.07.19, 02:13 AM Flag
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