Reply to More profitable for DC landlords to "sit" on empty storefronts than rent at market rate??

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Reply to "More profitable for DC landlords to "sit" on empty storefronts than rent at market rate??"

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[quote=Anonymous][quote=Anonymous][quote]Thank you for this insight, but I don't think it really answers why commercial landlords are charging astronomical rents per month and keep raising them, even when it then drives a restaurant that does "good" business out. Ie, the restaurant would stay if the rent didn't keep soaring to unobtainable prices. In our neighborhood weve ended up with only fast food and fast express (high volume businesses). And banks. How does adding more residential density change anything? A sit down restaurant can only seat so many at a time. Perhaps the rents are what need to to be looked at, and a penalty for properties that sit empty for ages.[/quote]

We live in a free market economy.  What you think of as an "astronomical" rent may in fact not be.  Landlords ask for the highest rent they think they can get.  Sometimes, especially with new developments or heavily leveraged refinancings, a landlord's lender has set rent levels within the loan documents so that the landlord has to try to obtain those rents and is willing to wait for months in order to get them.  Fast food and banks pay high rent.  Banks are great credit---they always pay the rent and they require much less than the average restaurant in terms of Tenant improvement allowances.  WaWa is a great example of a fast express user who set out 5 years ago on a major effort to compete with 7-11 in urban markets---they went into Columbia Heights, Adams Morgan, G-town etc., with a willingness to pay a huge premium over the asking rents at the time.  [/quote]

So we want more vibrant density (ie high population) to get money out from the  bank and dine at Wawa? Or the empty storefront next to it? That doesn't sound like any urban planning to me. [/quote]

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