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You're missing a critical element of this scenario: key money. When business A fails, the owner does not sublet to business B - they sell their lease, and they
by subpixel 8y ago
You're missing a critical element of this scenario: key money. When business A fails, the owner does not sublet to business B - they sell their lease, and they charge a hefty fee. So business B has to pay for the privilege of paying already exorbitant rent.
Also, with respect if you moved to NYC in 2013 you've never actually experienced what came before hyper-gentrification.
- bko 8y ago> When business A fails, the owner does not sublet to business B - they sell their lease, and they charge a hefty fee. So business B has to pay for the privilege of paying already exorbitant rent. If business A can sell the lease for a premium then the market rate for that lease is higher than originally signed. Even if they broke the lease, the owner would likely charge the higher rate to business B. The owner won't just automatically just give the new lessee the same terms
- subpixel 8y agoCommercial retail leases in NYC make specific provisions for key money. It's completely above-board and does not break the lease.