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Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

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Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#31

Post by twblalock »

sudosysgen wrote: post #18
twblalock wrote: post #13

Earlier quoted context omitted.

> If the landlords didn't want to deal with loans then they should have paid cash for the properties. If the tenants didn't want to pay rent, they should not have signed leases. Why is it that tenants can get a break on their obligations but landlords can't? Why are tenants more deserving of help? Most landlords are not rich. They are providing a service to their tenants, who cannot afford to purchase buildings and w…

Because landlording is an investment, having shelter is a necessity. The landlords should carry the risk of tenants failing to pay. If we stopped relief to everyone, tenants would stop paying, rents would crater, and landlord would be ruined much moreso than tenants, it's just the nature of investment.

The investment component of being a landlord is the value of the property. The ability to enforce contracts, e.g. that when a tenant promises to pay they must pay, it not part of the investment component of being a landlord. That is not an investment, but rather a contract between two parties.

Rent is revenue. Investment is based on the value of the underlying asset. They are not the same thing.

Our society has always assumed that the investment has a risk element but the rent is ensured by law and there are remedies if it is not paid -- remedies which are now being suspended for tenants paying landlords, but not for landlords paying their mortgages.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#32

Post by twblalock »

ABCLAW wrote: post #29
twblalock wrote: post #13

Earlier quoted context omitted.

> If the landlords didn't want to deal with loans then they should have paid cash for the properties. If the tenants didn't want to pay rent, they should not have signed leases. Why is it that tenants can get a break on their obligations but landlords can't? Why are tenants more deserving of help? Most landlords are not rich. They are providing a service to their tenants, who cannot afford to purchase buildings and w…

Over the course of a given rental, unless the property was purchased almost immediately before a real-estate crash or rental crisis, the amount of cashflow generated by a tenant will cover the majority of the volume required to generate equity in the property. In certain cases, the financing for commercial real estate, for instance, will literally substitute the credit rating of tenants for those of the landlords - b…

> The fact that we've been spewing money at asset holders for over a decade is why real-estate metrics are historically crazy.

No, the reason is restrictions on building which have constrained supply.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#33

Post by DeonPenny »

swiley wrote: post #20
t-writescode wrote: post #4

Earlier quoted context omitted.

Those landlords also need bailing out. They need to pay their loans, as well.

God no. They've been sitting on empty buildings for years. It's time for them to default on the underwater loans and let people actually put the wasted space to use. Every city in the US has a similar issue including the one near where I grew up and it's the weirdest most broken thing. I remember many times walking down streets flanked by empty buildings with homeless people sleeping outside.

Thats not how any of this works. The problem with a market is you have a rate that if something is below it its not profitable for people to live in a place. Idk why people blame the building owners.

And people who do this are always people with perfectly good couches in their living rooms but would never let a homeless person sleep there, but want others to give up a entire building.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#34

Post by jojobas »

t-writescode wrote: post #4
markdown wrote: post #3

Earlier quoted context omitted.

That money just goes straight to landlords. Henry George's time has come.

Those landlords also need bailing out. They need to pay their loans, as well.

Would you also bail out those who bet on black and got red?

When you bail out something like Ford you keep it running and collect tax revenue. If you don't, factories stop and the business essentially disappears.

When a landlord goes bust nothing happens, other the financial loss for the landlord.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#35

Post by dehrmann »

Only related because NY, but NY state covid 19 new cases have been incredibly flat since June. I would think they'd trend closer to zero, up some, or just bounce around more. Normally, new cases are driven up by complacency and down by fear or policy, but there doesn't seem to be either happening quickly and subtly enough to keep new cases between 500 and 1000 for so long, and r0 should be metastable, so keeping it in that range for so long is unexpected.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#36

Post by ABCLAW »

twblalock wrote: post #32
ABCLAW wrote: post #29

Earlier quoted context omitted.

Over the course of a given rental, unless the property was purchased almost immediately before a real-estate crash or rental crisis, the amount of cashflow generated by a tenant will cover the majority of the volume required to generate equity in the property. In certain cases, the financing for commercial real estate, for instance, will literally substitute the credit rating of tenants for those of the landlords - b…

> The fact that we've been spewing money at asset holders for over a decade is why real-estate metrics are historically crazy. No, the reason is restrictions on building which have constrained supply.

Which would make sense except there are plenty of metropolitan areas which are not physically constrained or suffering horrendous zoning issues which also have the issue.

The world exists outside the particular clusterfuck that is the SF bay real estate market.

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#37

Post by kingkawn »

ars wrote: post #6
runawaybottle wrote: post #2

Bail them out. We bailed out far worse in this lifetime for us to wince at this.

There are "660,755" restaurants in the US (according to Google), and average rent is $5,000/month = $3,303,775,000 (3 billion per month). Seems doable? Except .... did you forget about all the other places not paying rent? My guess is around 10 million of them. So "only" $60 billion or so per month. Is that affordable? Well, do you want to pay that in taxes?

A pittance relative to the government spending so far on the pandemic, mostly as giveaways to the rich

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#38

Post by [deleted] »

ABCLAW wrote: post #36
twblalock wrote: post #32

Earlier quoted context omitted.

> The fact that we've been spewing money at asset holders for over a decade is why real-estate metrics are historically crazy. No, the reason is restrictions on building which have constrained supply.

Which would make sense except there are plenty of metropolitan areas which are not physically constrained or suffering horrendous zoning issues which also have the issue. The world exists outside the particular clusterfuck that is the SF bay real estate market.

[deleted]

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#39

Post by trophycase »

ars wrote: post #6
runawaybottle wrote: post #2

Bail them out. We bailed out far worse in this lifetime for us to wince at this.

There are "660,755" restaurants in the US (according to Google), and average rent is $5,000/month = $3,303,775,000 (3 billion per month). Seems doable? Except .... did you forget about all the other places not paying rent? My guess is around 10 million of them. So "only" $60 billion or so per month. Is that affordable? Well, do you want to pay that in taxes?

We had a 2 trillion stimulus. 3 bil/month seems absolutely fine to me

Re: Almost 90 percent of NYC bars and restaurants couldn’t pay August rent

#40

Post by petre »

twblalock wrote: post #13
nradov wrote: post #5

Earlier quoted context omitted.

I don't want my tax money used to bail out landlords. Let the lenders foreclose. If the landlords didn't want to deal with loans then they should have paid cash for the properties.

> If the landlords didn't want to deal with loans then they should have paid cash for the properties. If the tenants didn't want to pay rent, they should not have signed leases. Why is it that tenants can get a break on their obligations but landlords can't? Why are tenants more deserving of help? Most landlords are not rich. They are providing a service to their tenants, who cannot afford to purchase buildings and w…

> A renter signs a contract promising to pay rent.

They should use the force majeure clause to terminate their contracts and the landlords could sue if they don't like that. A pandemic is not unlike a flood or earthquake. This is exactly why such a clause exists in contracts.

My boss negotiates a lower rent during a crisis. It’s fair enough. Would the landlord prefer a smaller amount to none at all?

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