Quote:
Originally Posted by billethkid
For some who have gone out of business it is very convenient to blame the high rent......usually not the reason.
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Well, yes and no. Some businesses might feel the EXPECTED or promised traffic will allow them to absorb those higher rental fees and then fail because they don't get the expected traffic (business) OR as busy as it is it's still not enough volume to cover their expenses. So from that prospective high rents can cause business failures for small and medium sized individual businesses. We owned a small (under $1mill) business up north for over 30 years between ~1970-2000 and year after year as larger businesses wanted to move in our rents and fees and percentage of taxes the landlord wanted moved up and up way above what would have been considered normal until eventually, even with the same thriving business we failed because the costs were out of control. In our case the landlord in our thriving town tripled our rent to get rid of us so a CVS could move in. As it turned out 2 years later that CVS left town to move 3 miles away sticking the landlord for 17 remaining years on the lease and the store remained empty for something like 10 years. Haven't looked recently so it could still be empty or maybe it's now a parking lot. As of now the "small town" we were in is thriving but filled with major merchants many of which who can absorb all the costs by spreading it among their hundreds or thousands of locations.
Think of it as the small single owner local restaurant who can't survive now due to covid but many major restaurant chains can afford to stick it out. It's the little guy that is affected by high rents and there is really no place for them to go but out. Same thing happens in good times when landlords jack up rents with the object of not giving the little guy a chance because he can (RIGHTFULLY) get more $$$$ from the big guys resulting in the wiping out of major numbers SMBs nationwide.
So yes, HIGH RENTS, FEES & TAXES will prevent and/or kill SMB's from either moving in or surviving if they try. That's why in another 5 years (thanks to COVID rushing it along) the only shopping you will likely have is Amazon (slight hyperbole of course).