4 ms·

Something related is happening with commercial real estate in Germany: Big retail chains like H&M, adidas, Deichmann have stated they won't be paying rent begin

Something related is happening with commercial real estate in Germany: Big retail chains like H&M, adidas, Deichmann have stated they won't be paying rent beginning in April (they were forced to close their stores). Ironically democratic socialists have complained about that. My guess is that this will be a rude awakening for the rent seeking individuals that profited from record low credit to finance and then rent out properties at record rental rates.

deleted 7y ago
[deleted]
cycomanic 7y ago
Well the reason why people are complaining about this is that these companies are sitting on huge cash reserves but are abusing the system meant to give short term relief to small businesses and individuals. It might even that they are planning to put those owners that they are renting from into so much financial trouble that they could buy up properties at a discount. I don't have much sympathy for property speculators etc., however I have even less sympathy for big corporations abusing systems not meant for the to concentrate even more wealth onto themselves
- Slartie 7y ago
  They don't really need to "abuse" these relief regulations (I'm not sure they are even doing it, because I'm not sure if the protective regulations actually cover commercial rentals, which are generally much less protected by law than private rentals). The landlords of these shops don't have any incentive to throw these merchants out because of a few months of missing rent during a time in which most retailers are forced to close. Where should they find any alternative tenants for these properties? Nobody could even move in right now, much less sell anything there. The first time at which they could potentially find someone to market these properties to is when the restrictions on the already-existing tenants are most likely being lifted as well, which means they will start paying rent again. The only risk for the merchants is that the landlords might take them to court in order to make them pay the missing rent. But that is a rather calculable risk, these big merchants all have legal departments able to handle this risk, and even in the worst case (they are made to pay the full sum) these court decisions will take months until they come into effect, so the primary goal of conserving liquidity during the forced business shutdown time has already been achieved.
  - durnygbur 7y ago
    Interestingly in Germany I'd encountered analogical but reversed situation. Landlords coming up with made up fees and deducting them from the deposit, incorporating the unlikely risk that tenant will fight for their money in the court. In no other place in EU where I have been living in, the relationship between tenant and landlord has been so tense and stressful.
    - Slartie 7y ago
      Yes, this happens, mostly between private landlords (of which Germany has a lot) and tenants of (seemingly or actually) limited legal competence (because private tenants are in fact relatively well-protected by law except for some gaping loopholes ("Eigenbedarf" being the most-exploited one), but of course accessing that protection often means they have to go to court first, which is a considerable financial and cognitive bar not everyone is able to jump over). I am not sure if it's more often than in other European countries, because I refuse to believe it doesn't happen there as well. You have a large difference in power, it gets exploited, one way or the other way round.
      - durnygbur 7y ago
        > I am not sure if it's more often than in other European countries, because I refuse to believe it doesn't happen there as well. You have a large difference in power, it gets exploited, one way or the other way round. Imagine that in places in Czechia and Poland where I was renting long term, the landlords were returning the full deposit in cash, in exchange for the apartment keys.
  - cycomanic 7y ago
    In Germany the looser will have to pay the winners legal cost so this would be a sure way to pay significantly more than just the missing rent. Also regarding they could just move out, you realise that these type of shops usually have very long term leases, so it's unlikely that they would get out within the time frame of the pandemic.
durnygbur 7y ago
Companies producing their stuff in the sweatshops, by exploited workforce, in the poorest regions of the globe. Then selling this stuff with an absurd markup. Companies held by family clans which have become richest on the entire continent. They don't have money for their rent, hmm....

deleted 7y ago

[deleted]

cycomanic 7y ago

Well the reason why people are complaining about this is that these companies are sitting on huge cash reserves but are abusing the system meant to give short term relief to small businesses and individuals. It might even that they are planning to put those owners that they are renting from into so much financial trouble that they could buy up properties at a discount. I don't have much sympathy for property speculators etc., however I have even less sympathy for big corporations abusing systems not meant for the to concentrate even more wealth onto themselves

Slartie 7y ago
They don't really need to "abuse" these relief regulations (I'm not sure they are even doing it, because I'm not sure if the protective regulations actually cover commercial rentals, which are generally much less protected by law than private rentals). The landlords of these shops don't have any incentive to throw these merchants out because of a few months of missing rent during a time in which most retailers are forced to close. Where should they find any alternative tenants for these properties? Nobody could even move in right now, much less sell anything there. The first time at which they could potentially find someone to market these properties to is when the restrictions on the already-existing tenants are most likely being lifted as well, which means they will start paying rent again. The only risk for the merchants is that the landlords might take them to court in order to make them pay the missing rent. But that is a rather calculable risk, these big merchants all have legal departments able to handle this risk, and even in the worst case (they are made to pay the full sum) these court decisions will take months until they come into effect, so the primary goal of conserving liquidity during the forced business shutdown time has already been achieved.
- durnygbur 7y ago
  Interestingly in Germany I'd encountered analogical but reversed situation. Landlords coming up with made up fees and deducting them from the deposit, incorporating the unlikely risk that tenant will fight for their money in the court. In no other place in EU where I have been living in, the relationship between tenant and landlord has been so tense and stressful.
  - Slartie 7y ago
    Yes, this happens, mostly between private landlords (of which Germany has a lot) and tenants of (seemingly or actually) limited legal competence (because private tenants are in fact relatively well-protected by law except for some gaping loopholes ("Eigenbedarf" being the most-exploited one), but of course accessing that protection often means they have to go to court first, which is a considerable financial and cognitive bar not everyone is able to jump over). I am not sure if it's more often than in other European countries, because I refuse to believe it doesn't happen there as well. You have a large difference in power, it gets exploited, one way or the other way round.
    - durnygbur 7y ago
      > I am not sure if it's more often than in other European countries, because I refuse to believe it doesn't happen there as well. You have a large difference in power, it gets exploited, one way or the other way round. Imagine that in places in Czechia and Poland where I was renting long term, the landlords were returning the full deposit in cash, in exchange for the apartment keys.
- cycomanic 7y ago
  In Germany the looser will have to pay the winners legal cost so this would be a sure way to pay significantly more than just the missing rent. Also regarding they could just move out, you realise that these type of shops usually have very long term leases, so it's unlikely that they would get out within the time frame of the pandemic.

durnygbur 7y ago

Companies producing their stuff in the sweatshops, by exploited workforce, in the poorest regions of the globe. Then selling this stuff with an absurd markup. Companies held by family clans which have become richest on the entire continent. They don't have money for their rent, hmm....