Originally published at: https://boingboing.net/2018/09/13/duane-reed-citi-cvs-chase.html
Originally published at: https://boingboing.net/2018/09/13/duane-reed-citi-cvs-chase.html
It sounds like the city gentrified itself right to empty storefronts. Landlords “know what they got” and don’t want to consider that the high end retail market is beyond saturated and there are plenty of lower rent establishments that would be happy to go in there.
If there was a land tax, landowners would be incentivized to make use of their property as soon as possible. It would help with the insane nyc rents too.
Its not just the city either. While I’m in the broader Metro area, I live between a beach and a potato field. Well outside city limits.
I can think of multiple large commecial spaces that have sat vacant for a half decade or more as owners wait for a mythical rich city buyer who will pay 2-3 times the assed value of the property or building. Just withing spitting distance of my house.
Lots more vacant housing too.
It’s not even just New York, though it may be worse there than other places. Landlords would rather rent to a bank or a Starbucks than to a local business, even though the local business may be better for the community (and therefore, their property values).
Well yeah. In terms of extremity its a bit of a step above in NY and some other areas. What we’re talking about is these land lords would rather not rent at all. Some of these building will rent to chains or luxary brands. Temporarily. Because those are the only tennants that can justify the cost. But they frequently close, or rotate. And the rent continues to rise to the point where even Starbucks can’t afford it.
Theres a store front near me that has swapped over on a two year schedule. Starbucks, subway, taco bell, local business. Repeat. For decades. There have been two different Subways and 4 different Taco Bells in there. Countless independant restaurants. It’s spent most of the last 15 years vacant. Nothing seems to stay open longer than 18 months. Its a cheap stripmall, with sewer and drainage problems. And Starbucks couldn’t justify the cost for more than a year.
Theres another restaurant space. Its been vacant for 10+ years. It was apraised at around a million bucks, stand alone building outdoor space on a main arterial road, and its own parking. Big building. The owner has been asking 3 mil for it for a decade so its sat vacant. He forced a local business out supposedly to sell it. The value of the building has dropped a lot since it hit the market. As it hasnt been maintained and its no longer up to code for commercial and restaurant buildings. He dropped the price 3 years back. $2.6 million. He’s had multiple offers to buy. Including from large companies and chains. He’s had potential tenants including non-local moneyed ones. Still vacant.
My “large” fly over city is giving tax breaks to developers to build retail space on the same block that has had buildings sitting empty for many many years.
I always assumed that the private owner could somehow benefit in other ways by having it sit empty… taxes, grants, etc? Or if an investor group owns the building than it is just a small insignificant line item on the ledger, and eventually someone will buy it.
A quick look at San Diego, and you’ll arrive at the same conclusion.
Landlords insist that they’re not to blame and that there’s no price-gouging going on. Meanwhile, retailers who’ve spent decades in the same storefront are disappearing, and blaming massive rent hikes for their closure.
The last sentence has plenty of evidence to back it up; the first not so much.
I’ve seen this happen in every large desirable city: a store or restaurant (successful chains included) that’s been doing steady business in the location and paying its rent regularly for more than a decade refuses to give into a landlord’s extreme greed. The tenant leaves and the storefront sits empty for years while the owner writes it off on his taxes and waits for a bank or coffee chain or fast-food outlet or a luxury brand to rent it.
Now the gouging may be driven in part by the rise of e-commerce and those pesky Millenials, but that’s a beard for what’s really going on. Any tax credits on an empty income property should last for 18 months, maximum; if the space is still vacant after three years it’s vacancy tax time.
It’s way past time to tax the shit out of owners who let their properties sit vacant for extended periods of time. Same goes for residential properties. Basically, empty housing and empty commercial buildings shouldn’t be able to be used as mere investments, when there are people going homeless and businesses who can’t afford storefronts. Market won’t support rents as high as you’d like to charge? Tough shit, that should be the risk when you buy property other than to live in. Letting it sit empty should be made so prohibitively expensive that owners will fill everything they can.
Feels like things might be turning back full circle. I remember Manhattan in the 80s was full of emptied out warehouses, storefronts, and entire buildings. Granted, it was for entirely different reasons, but for a while there, all that emptiness gave life to a real underground culture. Manhattan today feels too much like Disneyland. Maybe, the island needs just a little more blight.
(I’m only half serious about this. 1980s Manhattan also had way more crime and poverty.)
20% doesn’t sound so bad. If I recall, it’s 8-11% in a healthy economy, so NYC isn’t a ghost town quite yet. If the problems outlined above are accurate, then I hope the City Council or whoever is on the ball, but I won’t lose much sleep. Maybe when I’m on the council in Undisclosed Location, I’ll reread this for some lessons.
I keep feeling like municipalities should enforce eminent domain more, and take away vacant properties from owners who leave them vacant. Yeah, I know, it would be perverted into a tool for gentrification and for locusts to abuse, but a boy can dream.
No, really, though: if we can take away animals and children from people due to mistreatment, why not apply the same principle to buildings and lots? If a court finds you guilty of negligence, give the building to caretakers who will make it into a community non-profit cente, no for-profit usage allowed any more.
Hmm. Mistreating children and animals feels somehow different, but I can’t think of exactly why.
I wonder how much commercial real estate in various urban areas sits vacant for similar reasons. I was in the core of my local downtown recently and saw that a building was being renovated and realized it had been empty for decades. Then I started looking around and noticing all the empty spaces in the area, many of which had also been empty for decades. All this in the downtown core of one of the most expensive real estate markets in the country, developers sitting on properties, waiting.
Add Hawaii to the list of places where landlords build endless retail spaces while existing venues go begging. We have a mall that was built only about a decade ago. At that time, it was fully rented. Now more than half of the storefronts are empty (Lowe’s built their own store on land they own, Sports Authority and Borders went bust), but heaven forbid the landlords would drop prices to entice new businesses or retain existing ones. There are malls all over the island like that; meanwhile the land owners build new storefronts with low introductory rents, then jack the rent up after you’ve been there a couple of years.
Its very strange. Used to be a decades empty building was a bad neighborhood thing. They sat and moldered because they had no value, at sale or for rent.
Now in a lot of areas the buildings in the run down area are getting snapped up on spec. And the long vacant spaces are in the areas with high land values. In a sense they’re too valuable to rent. And in the worst of it, when you dont have “flag ship store in soho!” chache. Even massive, wealthy companies can’t justify the price.
Not just a NY thing, and not just and Urban thing. But the higher the overall land values in an area the more extreme the presentation. I’d imagine the Bay Area sees about as much of it as I do.
Here in Cambridge there’s an old movie theatre in the middle of Harvard Sq. that’s been vacant for years–a big space in a prime commercial location. And the city has in fact made threats to claim the building as abandoned if the owner doesn’t do anything with it, but so far nothing has actually happened.
Here in the South SF Bay Area, commercial space has long had a lack of demand, so it made sense that much was empty. Even now, I suspect that’s true - so while residential real estate is crazy expensive, commercial space is probably a lot cheaper. (And why I know people who tried to live in commercial office spaces…) Although I think the upper floors of these buildings were set up for residential, and were also empty.
I suspect the sprawl of Silicon Valley does a lot to create the problem here - it’s easy and far more profitable to find empty land on which to construct new houses and office buildings on the fringes, because people are willing to have crazy commutes, rather than renovate an existing building in a downtown. (And most Bay Area cities don’t have proper urban cores to attract people like San Francisco does.) So that’s what developers have been spending their money on.