Video: Hex Game Cafe Owner Diagnoses UWS Retail Malaise, Calls Some Arguments ‘Crazytalk’

Upper West Siders are stressed out about the vacant storefronts throughout the neighborhood. Mark Miller, co-owner of Hex & Co. at 112th and Broadway, has a unique perspective on the issue, having spent much of his career in commercial real estate. Hex is a “board game cafe” that serves coffee and beer, and holds after school classes. Miller describes it as five different businesses in one. The business has thrived and it is planning to move to a larger location on Broadway and 114th later this year.

Christopher Ming Ryan, a principal of the video agency Wheelhouse Communications and the founder of the Facebook site Disappearing NYC, has been documenting Mom and Pop stores struggling to survive. He recently sat down with Miller to get his perspective. See the video below:

NEWS | 55 comments | permalink
    1. B.B. says:

      Dear Lord, finally a voice of reason!

      Thank you!

    2. Bernie says:

      The mother of modern board games was a real estate game!

      • UWS_lifer says:

        Yeah, not only was this guy the CEO/CFO of a mid-sized real estate company I hear he also built hotels on Broadway AND Park Place and even owned a couple of Railroad companies.:)

        In all seriousness, this guy knows what he is talking about. People with this theory about incentives for landlords to keep stores empty are starting to sound like Flat Earthers or Anti-Vax types.

    3. Sherman says:

      This was a very informative and intelligent explanation by Mark Miller.

      It’s refreshing to hear somebody rationally explain the reason for empty storefronts without ranting about “greedy landlords”, “write offs” or secret tax breaks.

      Furthermore, Mr. Miller confirmed that no landlord somehow mysteriously comes out financially ahead by having empty space.

      Unfortunately, there are too many readers of WSR who are set in their ways and will not believe these facts.

      I’m curious what the comments will be.

      • Jay says:

        The comments will be what you expect; full of illogical reasoning and lack of facts.

        It won’t be long before there’s a comment about tax breaks for keeping a space unoccupied.

    4. rs says:

      This is at best disingenuous, not surprisingly since this guy is in real estate. He talks about landlords as if they were all individuals who own a single property. But in fact many are not individuals at all, but Real Estate Investment Trusts (REITs) and for them, owning multiple properties, an empty one can be use to offset income from a rented one.
      I will say though that his points about the city bleeding small businesses is correct.

      • Woody says:

        It’s irrelevant who owns the property and how many other properties are owned. An empty space brings in no income. No one owns property with the intention of keeping it vacant. Property owners have long-term perspectives on the profit potential of their properties.

        • UWSreader says:

          I don’t think this is necessarily true. Owning multiple properties could impact your willingness to lower rents to fill a space, especially in a business that is heavily dependent on comps. It is true that I make no income on an empty storefront, but if I own a portfolio of other spaces in the neighborhood, I may be less willing to lower the rent on an individual space – to the point where it ends up being vacant longer than anticipated – so as not to set the price lower for the rest of my portfolio.

          I think this happens in residential as well. If I have a 30 unit building, and one vacant unit, I might be able to rent it out by cutting the asking rent by $200. But it still might make financial sense to forego that income to prevent my 29 other tenants from asking for a $200 cut at their next renewal.

          Not saying I buy in to the “greedy landlord” theme, but worth pointing out there may be a financial incentive to have an empty unit with no income, if you have a broader portfolio.

          I also suspect there might be some prospect theory at play here.

          • Jen says:

            Very true. Same applies to other areas, Hamptons for example. The owners who have multiple houses are willing to skip on renting some properties lower to maintain the high rent on many others.

            That’s where “market rate” economy simply just doesn’t work. Market rate implies completion.

          • Ignoramous says:

            Please explain “prospect theory.”

          • Sherman says:

            There is not a landlord in the country who deliberately keeps his space empty to offset income from other properties.

            There is absolutely zero chance a landlord can somehow come out financially ahead this way (and I’m writing this as a CPA).

            As Mr Miller pointed out there are numerous reasons why a space might stay empty for a long time.

            Stop posting ignorant garbage.

            • UWSreader says:

              Wow, “ignorant garbage”? You seem very angry about this. You aren’t even arguing the right point, though. Under most circumstances (at least the ones I am talking about) a landlord isn’t really making some binary decision to leave a space vacant or rent it – they are deciding on an asking price which isn’t binary, it’s a sliding probabilistic scale. If they go more expensive, they will make more money once a place is rented, but the place is less likely to be rented quickly. The cheaper they go, the less money they will make once it’s rented, but the quicker it will be rented. So I am not really sure what you even mean when you say “deliberately keeps his space empty”. That is not what my post was even saying. I was pointing out that many landlords set, and leave, rent prices higher than the current market will apparently bear. This is fact not opinion, or else there would essentially be no vacancies. If a landlord wants to find a tenant tomorrow, there is a clearing price at which that will happen (even if it’s -1000 dollars). So I think the more interesting question, which I was trying to discuss in a friendly way without any animosity in my post, is why don’t we see landlords adjusting prices lower to immediately find tenants? (which it seems like you interpreted as “deliberately leaving a space empty”)

              For an owner with only one property, I mentioned prospect theory. Let’s say a landlord could lock in a $200 a month “loss” by lowering the rent to fill a space immediately. But say there is some small chance they could leave the rent as is and a tenant would still come along this month, meaning no loss. Prospect theory (which gets in to how people inaccurately weight probabilities when risk is involved) would suggest they might choose the latter option. But often times, no tenant comes along, and this experiment is repeated over and over until the property has been vacant for over a year. Simply, the fear of cutting the rent, and signing a lease for x-number of years JUST before the tenant willing to pay the higher rate walked through the door, may cause many landlords to make what are essentially irrational decisions. Plus, after a number of months of vacancy, the sunk cost fallacy may also kick in – IE “I have already gone 6 months with no rent income coming in, if I cut now to find a tenant, my prior holding out would have been in vain.”

              The point I was making above about landlords with multiple spaces, is that it is even more complicated when the deal you sign on one space may impact the perceived market rates on other properties that you also own. At no point was I talking about some tax write off or something, which is what you seem to be suggesting. I am simply saying that if I have two units next door to each other, one vacant now and the other vacant in 6 months, and I cut the asking rent on the first in order to quickly sign a tenant, it will almost certainly lower the rent I will be able to obtain on the other space when it comes up in 6 months. This could further skew the “loss aversion” example I outlined above. This is why people often hate forced bank sales of properties in their neighborhood. The bank is willing to take a very low price in order to liquidate the property quickly. But that comp might end up dragging down the perceived “going rate” per square foot for the rest of the houses in the neighborhood.

      • B.B. says:

        Correction, Mr. Miller “was” in commercial real estate. He now owns/runs his own business.

        Furthermore someone with extensive background in RE (or anything else) is far better resource than someone else who doesn’t have a clue.

        Mr. Miller obviously must be doing something right, and knows how to run his business, while others are closing Hex & Co. is expanding into a larger new space.

        Mr. Miller explained what many others have said and continue to say; this so called “crisis” of retail is not due purely to landlord avarice.

      • Bill Rutledge says:

        I still believe that tax benefits give the owner the flexibility to leave the property vacant for many years. Sunset those benefits and the market will adjust. I’d like to see the numbers.

    5. Ha! Why? says:

      Why?
      Because potential customers cannot park, there are not any place they can park to find any place to park… all all thanks CB 7.

    6. UWSider says:

      Hex and Co is one of if not the most exciting and innovative retail innovation on the UWS in years. Kudos to them for making a success of it.

    7. Juan says:

      This was very interesting and helpful. But it still doesn’t address the basic question:

      You own a building and the lease expires in 6 months or a year – you should be very aggressively marketing the space.

      Should you be finding the market soft, don’t you take what you can get from the existing tenant? $1 from existing is better than $0. And after several months of active marketing, you should have a good sense of this. The tenant obviously also needs some predictability but I’m sure an agreement can be reached on a 5-year lease.

      Instead, the landlords “kick out” the tenants and their stores sit empty for years. From a basic economics perspective, it just doesn’t make sense.

      • B.B. says:

        Mr. Miller covered this in detail.

        First how do you know a LL hasn’t begun “aggressively” marking a space where lease is soon to end. I’ve seen plenty of “for rent” signs in existing stores where lease was about to end. Lo and behold many places ended up remaining with a new lease. So obviously your theory isn’t universal.

        Two, as Mr. Miller stated market rent is just that; just because a LL cannot find someone within a few weeks why should he rush to accept any low ball offer? Thus being stuck for twenty or more years with a tenant possibly paying far less in rent than otherwise possible.

        Finally as Mr. Miller makes clear the issue isn’t always a lower rent for many retail these days. A good number simply just do not produce enough revenue period to keep the doors open. You would have to chop their rent in half, and that may not be enough.

        Plenty of businesses facing issues reported on WSR that their landlords have been more than generous. The problem is sales, or rather lack of them which means revenue does not support business.

    8. Gary X says:

      Mark please run for public office. You have my vote.

    9. Antonio says:

      If what they are asking for is ‘what the market can bear’, these empty spaces would be rented within a year or two at most. The fact that these spaces remain empty for multiple years shows exactly that the landlords do not modify their asking price enough to actually rent the property but prefer to keep it empty. That point is beyond dispute. What motivates that rigidity is another question but the empty storefronts attest to this truth.

      • Sarah says:

        Yes. People who say that landlords don’t benefit from empty storefronts must explain the undeniable fact that they are quite happy to have numerous ones.

        I think the lay understanding is a little oversimplified/inaccurate–the discussion about comps above is relevant, as is the issue of multiple properties in a trust or similar, with losses on one building offsetting gains on another (TAXES OTHERWISE OWED BUT AVOIDED ARE EFFECTIVELY INCOME)–but if landlords are so market-sensitive, struggling so hard, there wouldn’t be so many long-term vacancies. This is not 2007, when one might legitimately have hesitated to enter into a 10-year lease during a crash. This is at/near the top of the market.

        • Woody says:

          Your logic is extremely faulty and suggests a lack of understanding of basic tax accounting principles.

          No…avoided taxes does NOT equal income because the owner had negative cash flow on the empty property and the tax rate is less than 100%. Do the math.

          If you reject a year-end bonus and therefore avoid paying additional taxes, do you have more income if your expenses stayed the same?

    10. Hyman Rosen says:

      It seems that landlords don’t want to hear what the market has to say, but instead think their precious darling storefronts are worth a lot more than what the market is telling them. So if there isn’t anything nefarious going on, then there’s something stupid going on.

    11. Andrew says:

      I thought this was fantastic, a really superb explanation by a guy who both runs a great store and has the background to understand what is going on.

      Two areas where I slightly disagreed with him were on the reasons for high vacancies/high rents:

      First, if there is significant market power/concentration of ownership in street retail (as exists in large portions of Manhattan), it could be a profit-maximizing strategy to have higher asking rents and higher vacancies than a fully competitive market would have.

      Second, to the extent that potential commercial renters are relatively price inelastic, but a sufficient number simply are not there to rent existing available spaces, a landlord might be better off maintaining a higher asking rent and simply waiting for the right fit to come along, if a significant rent cut will not affect demand.

      Otherwise, great commentary!

      • chuck d says:

        Just because this guy used to work for the real estate industry doesn’t mean he’s telling us the whole truth.Quite the contrary, he made a commercial for his shop and told us that landlords aren’t to blame. I call BS.

        He should explain how a huge storefront can sit empty for decades and the owner doesn’t go broke. Or how a “market rate” for a coffee shop works (because it doesn’t-you can’t sell that much coffee).

        Something else is going on. These properties are tax breaks and loan fodder.

        • B.B. says:

          Unless you’re talking about a taxpayer property without anything else above, ground floor retail is part of a larger building.

          Rents, monthly maintenance (co-ops, condos) and other income from residential means owner(s) of ground floor retail aren’t exactly sitting on something that doesn’t bring in any income.

          As for rest, it has been explained many, many, many, *MANY* times that LL’s of vacant retail space receive *NO* special tax deductions. What they can deduct are same as any other business, ongoing expenses (sewer, water, property taxes, etc…) related to ownership of property.

          See: https://www.landlordology.com/tax-deductions-for-landlords/

          Each building’s situation is different. If the only thing you own is a small five story walk-up plus ground floor retail, and the residential is 95% below market RS and RC tenants, there may be greater pressure to generate income from retail space.

          OTOH a large high rise/multi-family building that is mostly if not all market rate apartments, or owned (shareholders or condo), there might not be as much pressure for ground floor income.

          Co-ops and condos can raise monthly maintenance fees to generate income. If building is a rental and LL has a portfolio of properties they can balance things out between performing and under performing buildings.

      • Mark Miller says:

        So, thanks everyone for the very thoughtful comments.

        To Andrew’s comment, the last figures I saw indicate that roughly 50% of the buildings in Manhattan are owned either by individual or small groups/families with three or four buildings. The rest are divided up amongst large groups including the Universities.

        My RE experience was in such a family based company. We certainly had no market power for rent setting and honestly, very little visibility into real, local market rents. Most of the other small groups were as clanish as we were and did not like to share this kind of information. The big guys could not be bothered talking with us at all.

        In our five oddly shaped, not-too-interesting-to-a-national-tenant storefronts, we tended to rent to small, local practical businesses (a restaurant, a pharmacy, a dry cleaner, a nail salon, etc) as we thought these to be the most stable due to enduring, local demand.

        We were more concerned with the quality of the tenant both as a business and as people than with the fine details of the rent. We did fine overall within a small but reasonable range that we thought was close to ‘market’. We supported our tenants when they genuinely needed help but sometimes they were simply beyond help for one reason or another and went out .

        It was NEVER in our interest to keep a storefront empty. Never. We lived in some amount of fear about this given the need to use the commercial rent to underwrite a the majority of our holdings which were rent controlled and rent stabilized apartments in the face of rising costs, taxes and fees.

        When a commercial tenant went out, it was often very hard to find a quality fit. And expensive to everyone involved when and we compromised on tenant selection and it did not work out. ‘Low ball’ offers from tenants interested in short terms leases usually ended up this way. Good tenants who are solid financially, savvy, and good people to be in a business relationship with are very hard to find.

        I think our experience was pretty typical of the 50% of the market we were a part of.

        As to the big landlords, I can’t say too much having little to no experience with that type of company. While I can imagine some advanced tax maths that might make it profitable to keep one’s most valuable assets idle, it’s hard to imagine the specifics. Most businesses would rather make more money and pay some tax then make less money in order to somehow pay less taxes….

        • Evan Bando says:

          Thank you, Mr. Miller, for clarifying that you can only speak to “our five oddly shaped, not-too-interesting-to-a-national-tenant storefronts… We tended to rent to small, local practical businesses (a restaurant, a pharmacy, a dry cleaner, a nail salon, etc) as we thought these to be the most stable due to enduring, local demand.” And thank you for admitting that “as to the big landlords, I can’t say too much having little to no experience with that type of company. While I can imagine some advanced tax maths that might make it profitable to keep one’s most valuable assets idle, it’s hard to imagine the specifics.” Yes, it is hard to imagine the specifics but not their existence. So, the so-called rumors of the financial benefits to empty storefronts may in fact be true. After all, most of the many empty storefronts throughout the city – during a robust economy with excellent foot traffic – are not “oddly- shaped not-too-interesting-to-a-national-tenant.” Greater transparency would be a good start to getting to the bottom of this anomaly. If, as you say, the small, clannish commercial landlords are secretive, you can just imagine how discreet the big landlords are. Again, thank you for your honesty and setting the record straight on your video comments.

    12. Pedestrian says:

      I like this guy but I don’t agree with some of his views.

      Landlords pitch out money making tenants and leave their storefronts empty for years, yes years. Landlords do have various tax incentives to leave their spaces empty.

      I agree that the city needs to do more to help small businesses. If the developers who built Hudson Yards can get massive tax abatements and around $250 million in taxpayers money, I think small business can be helped.

      Again, I like this guy.

      • Sherman says:

        Please name one “tax incentive” landlords have to keep their space empty.

        There is ZERO chance a landlord comes out financially ahead by having his space empty.

        The taxes he does not pay on nonexistent revenue will NEVER offset this nonexistent revenue.

        I’m a CPA. Don’t try to debate tax law with me.

        • chuck D says:

          sherman,

          Please let me know if this is wrong I’m going to use fake numbers to make it simpler for me to follow, but I imagine this is how it works:

          LLC buys a rental building with a large storefront for $10 Million. The storefront that is rented for $250,000 a year (I have no idea if these numbers are right)

          LLC needs cash to buy another yacht, so they use the building as collateral. They get a 30 year loan based on current market rates. Great!

          Two years later, the the tenant moves out. LLC struggles to find another taker at $250,000/yr. Best they can find is someone who is willing to pay $50,000/year.

          In this scenario, wouldn’t it make sense for the LLC to let the storefront sit for the remaining 28 years than to admit the value of the building has decreased significantly?

    13. Evan Bando says:

      The video still does not explain why – now – there are so many empty spaces in NYC during a robust economy where there are more people on the streets than ever before, residents and tourists alike. Only the 1970s had more empty storefronts. The internet has been around for a long time. New York retailers know the internet. That’s a bogus excuse. The curious thing about the current state of empty storefronts is that now even big corporate retailers are not setting up shop or they are leaving. Take the Starbucks formerly at 67th Street and Columbus Avenue across from ABC. It was known as one of the busiest, if not the busiest Starbucks in Manhattan. It left. Why? The landlord split the space in two and now a sort of fragrance, spa-like aroma therapy New Age store is in one half. It escapes me because it’s irrelevant to the street life. As for Hex, what kind of rent does he pay that he can talk stability for his omni-business. After school programs? Is he getting subsidized by the city in some way? Having been in the commercial real estate business for so long prior, he might have had the ability to wait for just the right deal to lock in just the right rent to give his board game outlet some legs. It seems unlikely he’s taking in revenue that Starbucks and other bigger players do. There is definitely something else happening in commercial retail. It might not be the “conspiracy” tax write-off rumors we have heard about but Miller might not know everything. He’s been out of the business. The city has never been busier. But storefronts remain empty in increasing numbers. Something else is at work. Something Miller does not address and probably does not know about.

    14. LKLA says:

      It surprises me that people keep debating this issue. I guess it must be an emotional / wishful / nostalgic thing.

      Everything in NYC is expensive and that certainly applies to buying real estate, maintaining real estate, real estate taxes and anything remotely related to real estate. And, as high as these costs are, they are only getting higher!

      That means that anyone looking to buy or rent an apartment, office, storefront, restaurant, garage or other real estate asset will likely be impacted by these high costs.

      In the case of storefronts and restaurants, they also have very high costs related to insurance, salaries, and other basic costs of running the business.

      What this often leads to is for BOTH property owners and business owners to establish unrealistic expectations for how much money the business will make in order to rationalize/cover these costs.

      Hence, restaurants, stores and other businesses need to be operating at extremely high levels of effectiveness and efficiency. You can not open a restaurant that has little if any business outside of Friday evening and Saturday. You can not open a store that competes directly with an internet-based store. You can not open a business that is nothing short of extremely successful!

      Who is at fault here – no one, and everyone. We live in a free country so real estate owners should be free to buy and sell and rent and lease properties as they wish for whatever price the market dictates and others are willing to pay. Anything else would be anti-democratic at best.

      Business owners and apartments residents need to better understand the costs involved and make more financially sound decisions. They should not open business that often seem clearly destined for failure or rent apartments that are clearly beyond their financial reach.

      What can be done? Nothing. Things will correct themselves. Always have, always will. Some times it takes a short time, other times it takes longer.

    15. Marcos says:

      I hear what Miller is saying but I think his perspective overlooks landlords with a big portfolio of buildings that have enough revenue and capital to sit on empty storefronts. It’s in their interest to avoid a race to the bottom with respect to rents. Not to mention the safety net of their real estate assets appreciating no matter how poorly they manage things.

      • LKLA says:

        Agree.

        If you have 25 units and are getting income from 23 of them, having the other two help you offset the taxes on the taxable income of the 23 units is likely not such a bad thing.

        In many cases, it is also a matter of what I would call “mark to market”. Some of these real estate owners borrow against their properties and do so based largely on the income stream the properties generate.

        Thus the higher the “market rate” these properties can fetch the more they can borrow and go and use that money to buy more properties. That is often why for example property owners will offer one or two months of free rent yet not lower the monthly rent (advertised vs net rent).

    16. GrumpyOldMan says:

      How does the vacancy rate of the Upper West Side retail corridor compare to other neighborhoods? What is the status of the Vacancy Data Base that has been proposed by Brewer? Of the vacant storefronts, how many are the result of a failed business? How many enterprises closed as the result of not being able to afford high rents or the landlords desire to not renew the lease? What has been the impact of on-line shopping and the influx of national chains on small business on the Upper West Side? How have the increasing number of coops and condos on the Upper West Side affected the retail corridors?

      • B.B. says:

        As Mr. Miller stated city politicians pander to a certain demographic, so yes, they are now going to force LL’s to report retail vacancies.

        https://gothamist.com/2019/07/24/empty_storefront_update.php

        City already has this information and or could easily find out, but adding yet more regulations to an already over regulated business environment gives city council and mayor bragging rights.

        As Mr. Miller stated, and everyone along with their mother knows online is a major worry for brick retail. The man is correct in that to sell anything you have to find something that cannot be found cheaper online. Good luck with that.

        Co-ops or condos only have ground floor retail if zoning requires usually. Most of the new luxury buildings along “Billionaires Row” have ground floor retail. As do many buildings along main UWS avenues. In all cases some have attracted tenants, others remain empty.

    17. What a great interview; that is so interesting! and his explanations of how the commercial real estate market work make a lot of sense.

    18. My expertise, small biz consulting; one of my civics concerns, the storefront crisis. Politicians and the community have lots to say (and, really, it’s they who will change things), but the video herein is wise and helpful input from an involved, successful UWS small biz owner.

    19. Carolyn says:

      I wonder (and someone probably knows the answer) how many of the vacant storefronts are Columbia buildings and how many are privately owned. One argument I heard from someone still in business is that there is not enough traffic in the area: students have very limited needs, and more stores would attract more shoppers. We no longer have a women’s clothing store in the area, for instance, and there is no men’s store either: CU has a market on sports clothing, and the B&N “bookstore” looks like a Columbia retail outlet: every article of clothing is marked with a CU logo. Yet I see few of these logos on students in the streets nearby. We could use fewer fast food places and more “real” shops: children’s and adult’s clothing, for starters. How many of the empty storefronts belong to CU?

    20. David Goldstick says:

      Spot on should be required viewing for all city council members and West Side renters

    21. Robert S Boynton says:

      Clearly, this is the kind of feature WSR should run more frequently: informative and entertaining. I wonder whether audio interviews would work as well?

    22. Becky Tesich says:

      Thank you, sir.

      Nice to have a cogent explanation.

    23. B.B. says:

      As have said previously many times, and am doing so again some of you just don’t understand how much things have changed.

      Has it ever occurred to any of you that spaces are remaining vacant because there just isn’t demand? We’re not just talking about due to rent either.

      Technology has removed the necessity for many business models to have physical retail/store fronts.

      Back in the 1990’s or so people were saying online shopping would *NEVER* overtake physical brick. People wanted to go to a store, look, feel, and so forth merchandise. Well that was totally wrong, as digital sales have exploded year after year.

      One of the largest expenses for any business after payroll is rent. If you can find a way to reduce (or even eliminate) that cost it is just more money in a business owner’s back pocket.

      As Mr. Miller stated opening and running a brick and mortar business in NYC is an expensive undertaking. There is a huge amount of fees, surcharges, permits, inspections and so forth before you even open the front door. Then there are ongoing fines, tickets, fees, high cost of labor and everything else that makes whatever sold cost twice or more than it would elsewhere. Online having lower expenses passes those savings onto consumers, and that is where they are going.

      Nearly every business profiled on WSR that has closed (excluding food, bars, hospitality) largely did so because they just couldn’t make enough sales to make a profit. Their customer base for everything from books to Shabbat, & Judaica items, right down to shoes, clothing and more have moved largely online.

      As for services you certainly don’t need a storefront either. You can go online and or download apps for everything from laundry to food delivery.

      There is a reason why you see same sorts of things opening over and over. Bars, food, various beauty services (manicure, barber, etc…), gyms/exercise, dog grooming/pet sitting etc…. These are things you cannot necessarily get online and or people prefer to go out.

      Days of opening a little shop selling tchotchkes is largely over. You can do that on places like Esty or even your own website without having to leave your apartment/home.

      • UWSreader says:

        All of this would seem to argue rents should be falling fast. I’m not disagreeing with any of this, just wondering why rents haven’t seen major discounts, to the point where retail business models (or any business for that matter) might make more sense and vacancies would be filled.

    24. MikeDNYC says:

      Wait a minute. If landlords are asking “market rates,” and the space remains unrented for years … those “market rates” need adjusting.
      And not upward.

      It’s not a market rate if not a single potential renter is interested. It’s a wish listing.

      • LKA says:

        Which is why landlords who own multiple properties (and most store fronts are owned by landlords who own the apartments of offices on top of them) are often ok with having the space empty to offset the taxable income on the other spaces.

        And, they seem to convince lenders to value and lend to them based on these market rates, which are often simply nothing more than advertised rates or wishful rates than they are actual real rates.

      • B flat says:

        Crains had an article addressing this issue, iirc the reason is what the property is valued at for borrowing against it. This lowering rents lowers the value.

        • Woody says:

          Lenders don’t determine the parameters of a loan without analyzing ACTUAL financial statements unless it’s a construction loan with projections.

    25. Paul L says:

      Very informative and I agree with most of his points. Residential and Commercial Leasing are two different enitities, and landlords are taking a big risk by giving out 10 or 20 year leases. What I don’t agree with is why are landlords so eager to let go of existing tenants and get zero income per month on the space and why the nyc court system is basically allowing landlords to evict commercial tenants at a whim. Landlords must be getting some benefit from evicting tenants or this would not be happening so prevalently: in my opinion, large landlords and the nyc court system favors landlords.Believe me, I had a store on the uws, was paying my rent for 7.5 years, fell a little behind and my landlord took me to court for eviction instead of working with me while I was still paying my rent monthly, late but it was being paid. Then, after my landlord won in court, he evicted me and then proceeded to sue me personally for arrears which the nyc court system gave him. I still do not understand to this day why my landlord decided to take me to court while I was only one month behind in rent, communicates with him and had every intention to catch up. As this gentleman states, it’s hard to find a match between tenant and landlord in commercial
      Space.

    26. B flat says:

      These point/counterpoint debates about why there is so much empty storefront blight is really getting tiresome. I’m ready for more detail. I wish stores would make the terms of their leases public so we can see for ourselves what the stressors on stores are, or are not.

      • Woody says:

        Just to satisfy your curiosity, you would like owners to reveal their personal financial details? On what planet would anyone just voluntarily do that?