Retail Rents Dropping in New York

While not a New Yorker by birth I lived in NYC for 19 years. I don't remember a blip on the screen during the 1991 recession. It was like it never happened. This time around I think it is going to get very nasty. NYC bankrupt--why not? The New York Financial community is at the epicenter of all the "phony baloney"--or is it toxic--paper loading up our banks. Who do you think securitized all that "stuff".

This latest article in the New York Times highlights the drop in retail rents. It appears to me that this is the beginning of a trend that is going to last for years. New York city businesses will be going out of business faster than anywhere in the country soon. Landlord's have been raising rents willy nilly for decades in NY--with little regard to what has been happening in the rest of the country. Read this.

Six months ago, for instance, the landlord of the Holland Bar in Hell’s Kitchen terminated the lease because he was confident of finding a higher-paying tenant or developing luxury condos. But when he found no takers, he offered the space back to the bar, at a 20 percent increase in rent. The Holland reopened last week.

Finding a higher paying tenant? Developing luxury condos? Out of touch with reality in the New York financial community. Then the bar pays up 20 percent? It appears that reality comes slow to New York citi-ites. Its gonna get increasingly ugly.

Rents have started to drop even on busier shopping districts like Madison Avenue, where a Grubb & Ellis report issued last month predicted that rents could fall by as much as 30 percent this year.

Recession Has Landlords of Retail Tenants Extending Discounts of Their Own

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