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Really interesting. There's an empty spot in my building that's a coffee shop storefront. When we moved in, I saw that it was vacant (beginning of 2020) and ask
by site-packages1 6y ago
Really interesting. There's an empty spot in my building that's a coffee shop storefront. When we moved in, I saw that it was vacant (beginning of 2020) and asked about rent. It was $9k/mo. I offered them $5k and they declined. Still vacant. That's a lot of lost income, but perhaps it makes sense in the sense of commercial real estate.
- chii 6y agoif they can offset the cost of the lost income from the (lack of) rent with some other source of gains, they pay less taxes! Also, if they accept a rent of $5k/m, it sets a new (lower) price ceiling, where as a $9k/m original price was the original ceiling which supports the current valuation. Thus the commercial real estate would have a harder time to capitalize on the equity. S Therefore, the losses are more than just the $4k/m difference - it's lost capitalization/equity to which one may leverage against, and lost tax offset potential as well.