Anonymous wrote:
Also money laundering.

Anonymous wrote:Why do so many people open restaurants when the margins are so low? To turn a buck, seems like it takes an awful lot. I worked in restaurants when I was young. It's hard work.

Anonymous wrote:

Anonymous wrote:It takes at least 6 months to open a restaurant. All of these openings were planned (and the investments made) pre-Covid, so that doesn't say much about that market.

I'm going to laugh because - yes, its true that they were pre-planned most investors would still pull out before opening if possible if they think the world is ending.

D.C. had 7% higher residential home sales in March 2020 vs March 2019 as well - people kept buying homes, life moves on. And now the market for home sales is even bigger.

I personally think the restaurants that opened and remain open will see a huge surge in the summer from bottled up consumer need. This is a screenshot which kind of shows just how well those that can meet the demand are doing (yes, they lack staff).

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Any new updates?

Didn't post earlier but for every restaurant that closed in my neighborhood 1.5 have taken their place.

In the next two weeks we're getting a Pupatella, Smokin Pig BBQ, Officina Italian Market, the Amazon Fresh store, and Baan Siam.

https://dc.eater.com/2020/6/5/21281479/baan-siam-thai-restaurant-opening-menu-food-photos-mt-vernon-triangle-dc

So IMO the reports that commercial rents would drop and no more restaurants would survive was wrong...as predicted.

It takes at least 6 months to open a restaurant. All of these openings were planned (and the investments made) pre-Covid, so that doesn't say much about that market.

Anonymous wrote:

Anonymous wrote:Any new updates?

Didn't post earlier but for every restaurant that closed in my neighborhood 1.5 have taken their place.

In the next two weeks we're getting a Pupatella, Smokin Pig BBQ, Officina Italian Market, the Amazon Fresh store, and Baan Siam.

https://dc.eater.com/2020/6/5/21281479/baan-siam-thai-restaurant-opening-menu-food-photos-mt-vernon-triangle-dc

So IMO the reports that commercial rents would drop and no more restaurants would survive was wrong...as predicted.

Anonymous wrote:Any new updates?

Anonymous wrote:I am the pp who is the investor in the restaurants. So many people on here clearly have never owned a smaller business before. Depending on how you count what is a business I own about 6-8.

Business 101 is that a business has to be in the black at all times. If it is isn’t the owner needs to adjust something to get into the black and so fast. Businesses that run in the red will fail.

If the restaurant pays its employees while shut down it will fail. If it spends the cash it has on rent for the next few months it will fail. The right strategy is definitely to go into crisis mode, pay absolute necessary expenses only and sort it out with everyone else later.

So strange so many people on here are concerned about the landlord. I’m surprised but hopefully pleasantly so. I own commercial properties throughout the areas with about 25 retail tenants. I expect those in the restaurant or other affected areas to call us and tell us the same thing. We’ll sort it out later. In my restaurants I intend to pay back the landlord. Maybe spread out over 12-36 months. No penalties and no interest. Frankly if my tenants made that same offer I’d jump in it.

As to the commercial landlord who says he is keeping notes. If you are more focused on a tenant paying you next month than their ability to survive and pay you in perpetuity you will have a lot of vacant properties in a few months time. I actually have a hard time imagining that you really are a retail tenant landlord. There are times to be a dick and there are times to work it out with tenants. I’m surprised you don’t know the difference.

And as to the posters asking why a restaurant doesn’t carry 6 months of all expenses in hand, you should know that restaurants net 4-8% of revenues. And also that savings held In The business are taxed to the owner the same as if the owner pocketed the money. Which means to accumulate 6 months expenses after taxes would take a restaurant roughly 8-16 years to accomplish.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A Commercial landlord here. We are of course being flexible with our tenants because, for many of them, it's the right thing to do. But you'd be foolish to think that we are not taking notes on those that are being difficult right now just to take advantage of the situation - we know who you are. Depending on how your lease is structured, we are taking it back in future months or on renewal - with interest. In the end, the customer pays for everything.

I'm a commercial landlord also. Serious question for you: How many tenants do you think will even survive this? I estimate no more than 50%. I am starting to think that the commercial/retail landscape of this country will be changed forever in the next six months. Between most restaurants evaporating, half of other SMBs dying, and things like telemedicine and WFH becoming acceptable, I see a pretty dire future. Not to mention the system financing problems i.e. unhealthy leverage inherent to commercial real estate.

I would say there will be turnover, but the resulting vacancies will be filled. The businesses that were here served real demand. I don't think there will be long-lasting consumer behavior change from a 1-3 month interruption in our lifestyle. People have short memories in the grand scheme of things. The cultural backdrop of American society is one of optimism and adventure. Sorry to say, most small retail storefronts are operating on very low profit to the point that they really can't survive an interruption like this. But replacement businesses will come back.

To hit on some specifics. Telemedicine will be very limited, IMO. Most patient visits are not just a consultation but involve an examination. There is no way to do this effectively and reliably without in-person contact. Teleworking is very difficult to implement for small businesses because they lack the resources to properly manage a remotely working staff. The office environment provides a degree of assured isolation, a sense of formality that serves to improve the efficiency of workers.

As to financing/leveraging, every landlord's situation is different. Hopefully, you don't have too much exposure of the wrong kind and can work with your lenders to smooth out short term ripples. Best of luck.

Anonymous wrote:TBH there are lots of small businesses in my area that sold over priced goods and food that weren’t going to survive anyways. And I don’t feel bad for them.

There are also just too many of the same type of businesses and if some close it won’t be a big deal either.

Lastly it would be nice if this was a wake up call to some of the local retail landlords to stop pricing out established small businesses with massive rent increases.