The sheer number of empty storefronts in nyc these days is an eyesore

[Anonymous]

and it really detracts from the city. Insane number of empty storefronts. It makes nyc look so run down.

https://www.nytimes.com/2017/12/03/opinion/em...s-new-york-city.html

https://www.nytimes.com/2017/11/19/opinion/nyc-empty-stores.html

[Anonymous]

I imagine this will happen nationwide to some extent as more and more shopping takes place online now. It will be awhile until this situation disappears and developers figure out the post-store era.

[Anonymous]

Storefront rent is too expensive for small businesses to maintain any profits.

But by the same token the owners would rather leave them empty than accept less than the 'market value'.

[Anonymous]

https://www.zerohedge.com/news/2018-03-22/sta...inancial-crisis-2008

howard schultz: "We took a walk in New York two weeks ago from 59th street to 79th on Madison Avenue, and we lost count of how many empty storefronts there were in Manhattan. It reminded me of the cataclysmic financial crisis in 2008"

[Anonymous]

https://www.nytimes.com/interactive/2018/09/0...refront-vacancy.html

New NYT article on how bad it is:

“When you walk the streets, you see vacancies on every block in all five boroughs, rich or poor areas — even on Madison Avenue, where you used to have to fight to get space,” said Faith Hope Consolo, head of retail leasing for Douglas Elliman Real Estate, who said the increase in storefront vacancies in New York City had created “the most challenging retail landscape in my 25 years in real estate.”

A survey conducted by Douglas Elliman found that about 20 percent of all retail space in Manhattan is currently vacant, she said, compared with roughly 7 percent in 2016.

[Anonymous]

I'm only surprised that it took so long for this issue to come to the forefront. Retail leases are an absolute ripoff and I never understood how smaller businesses could survive without the financial backing that the corporate chains have. Retail leases are minimum 3-10 years long. How in the world are you supposed to get out of a lease that long if your business ends up failing in the first year or two (which is when most small businesses will fail) if you're still on the hook for another 1-8 years of rent? Additionally, all retail leases pass along the landlords own repair/maintenance/marketing/advertising costs and responsibilities onto their tenants to pay. So, for example, if the HVAC system that was installed in your building 15 years ago fails during your lease term the small business is on the hook to replace it regardless of the fact that they don't own the property and can't take the HVAC system with them when they leave. Add to this drastic rent increases upon lease renewal and it's a recipe for failure. How would the typical nail salon, hair salon, cafe, coffee shop, bakery, bike shop, etc ever weather those situations and survive?

[Anonymous]

How would the typical nail salon, hair salon, cafe, coffee shop, bakery, bike shop, etc ever weather those situations and survive?

The survival strategy back in the day was for these business owners to buy the buildings they were located in. That is no longer an option for most due today's cost.

[Anonymous]

Landlords get to write these off. There should be a penalty for empty fronts after a certain number of months or whatever. And yes some will say that no free market will take care of this. But it's not a free market if the existing tax regulation benefits leaving the spaces vacant as opposed to renting them at a lower rate.

[Anonymous]

Anonymous wrote:Landlords get to write these off. There should be a penalty for empty fronts after a certain number of months or whatever. And yes some will say that no free market will take care of this. But it's not a free market if the existing tax regulation benefits leaving the spaces vacant as opposed to renting them at a lower rate.

Tax laws and other laws and loan rules probably create perverse incentives to leave units empty. But the solution is to fix the incentives, not let Manhattan become a retail desert.

[Anonymous]

Anonymous wrote:I'm only surprised that it took so long for this issue to come to the forefront. Retail leases are an absolute ripoff and I never understood how smaller businesses could survive without the financial backing that the corporate chains have. Retail leases are minimum 3-10 years long. How in the world are you supposed to get out of a lease that long if your business ends up failing in the first year or two (which is when most small businesses will fail) if you're still on the hook for another 1-8 years of rent? Additionally, all retail leases pass along the landlords own repair/maintenance/marketing/advertising costs and responsibilities onto their tenants to pay. So, for example, if the HVAC system that was installed in your building 15 years ago fails during your lease term the small business is on the hook to replace it regardless of the fact that they don't own the property and can't take the HVAC system with them when they leave. Add to this drastic rent increases upon lease renewal and it's a recipe for failure. How would the typical nail salon, hair salon, cafe, coffee shop, bakery, bike shop, etc ever weather those situations and survive?

On the one hand, a small business should be in demand by people. On the other hand, a high rent implies either an increase in prices or the wonders of marketing) I know the owners who changed signboards and window dressing every year to attract new visitors - https://fortunasigns.com/service/sign-installation-company-nyc/ I think this option is more suitable for small cafes or a retail store. I wonder how mini bakeries or car repair shops survive in such conditions ..

[Anonymous]

Anonymous wrote:Landlords get to write these off. There should be a penalty for empty fronts after a certain number of months or whatever. And yes some will say that no free market will take care of this. But it's not a free market if the existing tax regulation benefits leaving the spaces vacant as opposed to renting them at a lower rate.

This. There is A LOT the city should be doing to fix this that they aren’t. Landlords need to be incented to keep retail spaces occupied- both be tax incentive and blight/unoccupied penalties. Remember this for the next mayoral election.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Landlords get to write these off. There should be a penalty for empty fronts after a certain number of months or whatever. And yes some will say that no free market will take care of this. But it's not a free market if the existing tax regulation benefits leaving the spaces vacant as opposed to renting them at a lower rate.

This. There is A LOT the city should be doing to fix this that they aren’t. Landlords need to be incented to keep retail spaces occupied- both be tax incentive and blight/unoccupied penalties. Remember this for the next mayoral election.

This. The incentive needs to be there to rent the places and not for a tax write off.

[Anonymous]

NYC is failing. Not my town anymore.

[Anonymous]

Anonymous wrote:Storefront rent is too expensive for small businesses to maintain any profits.

But by the same token the owners would rather leave them empty than accept less than the 'market value'.

This is a case of market failure.

The problem is, once landlords move to a market clearing price, a lot of REITs and lenders will collapse and we’ll know we’re in a recession. Now we can pretend everything’s fine.

[Anonymous]

Anonymous wrote:NYC is failing. Not my town anymore.

+1.

Most life in the city is now in queens but do you want to deal w queens w/out manhattan culture???

They may as well create tax-immigration laws to London-ify at this point.