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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

#81

Post by dannyw »

viraptor wrote: post #53

Does anyone know what happens in practice with places where restaurants run in a space where the landlord defaulted? If the place is repossessed, I expect a bank which takes over the space would have more gain from literally anyone paying anything for the place until it's sold. On the other hand, I'm not sure the partial rent would be relevant at all to the bank which likely has no issues with sitting on an empty pro…

The Fed creates new emergency program / SPV that purchases foreclosed properties from banks, leases it to the original landlord at near-zero rates; until the outlook is more table equity value becomes positive again and then this 'troubled asset' will be sold back to the original bank.

Basically, expect several years of mortgage holidays for property owners, through the Fed.

To inflate the property market, the Fed will continue to purchase mortgage backed securities, (they currently own 1/3 of all MBSes) driving down the cost of interest, which increases borrowing power and demand, and drives up home prices.

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

#82

Post by brutusborn »

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.

Why can't it be both?

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

#84

Post by tyingq »

dannyw wrote: post #76
grey-area wrote: post #57

Earlier quoted context omitted.

Yes there's something going on we don't understand, because some places that were hit very hard first time round are not seeing a second wave.

Perhaps the "something" is simply antibodies and herd immunity? 1. In April (!!), 1 in 5 NYCers tested positive for antibodies: https://www.nytimes.com/2020/04/23/nyregion/coronavirus-anti... 2. Given asymmetric social contact patterns, experts estimate that ~20% may be the threshold for herd immunity of COVID: https://theconversation.com/coronavirus-could-it-be-burning-... I support looking at the science, and this…

That seems plausible. Both New York and New Jersey have lots of high density areas, yet their numbers are very flat now. There's also some speculation that some people might have a natural immunity.

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

#85

Post by hieunc229 »

paxys wrote: post #58

It's ridiculous that we couldn't coordinate a rent/mortgage forgiveness plan alongside all the customer bans put in place across the country. If a restaurant can't stay open, they shouldn't pay rent. If the property owner isn't getting rent, they shouldn't have to pay mortgage. And so on, up the entire chain.

If there is forgiveness in the hard time, there should be more to pay in the good time

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

#86

Post by hinkley »

brutusborn wrote: post #62
gkoberger wrote: post #51

Earlier quoted context omitted.

You can't end with "this isn't the time for ideology" after three paragraphs of YOUR ideology. For some restaurants, takeout is easy and they can make it work! For others, it really really isn't. What about bars, where most money is made on alcohol? You got it backward. These restaurants all presumably paid taxes and employed people, some for literally a century. Why do you expect them right now, when they're sufferi…

Why should we not expect organizations to give something back?

What do you think restaurants are for?

It sounds like you think they’re a scam.

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

#87

Post by nartz »

twblalock wrote: post #74
pfisch wrote: post #67

Earlier quoted context omitted.

When you go up that chain you will eventually run into a very serious monetary crisis that would crash the banks, the real estate market, and the entire economy.

No, you would end up with another bank bailout, except this time the banks didn't do anything wrong and it was the government's fault for screwing up the pandemic response. In other words, it would be compensation for the government's failure, not a bailout.

Everyone wants to blame someone - e.g. its the governments fault! In reality, its just an external force that everyone is dealing with, a plague, if you will - its not anyone's fault; it just must be faced, that during a plague, there will be suffering, and there will be casualties. It's that simple.

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

#88

Post by hinkley »

threentaway wrote: post #60
01100011 wrote: post #46

Subsidizing the restaurants without getting anything in return seems like a misallocation of capital. Allowing 'creative destruction' on a massive scale is harmful to social stability and frankly just cruel. People didn't plan for it, because it is implied in our various social contracts that they don't need to(and that may be wrong, but this is not the time to fix that). We should consider subsidizing the restaurant…

> We need to be pragmatic and get our people and economy through this crisis OK, tax the rich. PS: It was the winning strategy before the crisis too.

It was a winning strategy after the Spanish flu too.

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

#89

Post by mjfl »

grey-area wrote: post #57
dehrmann wrote: post #35

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 i…

Yes there's something going on we don't understand, because some places that were hit very hard first time round are not seeing a second wave.

cross-immunity

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

#90

Post by brutusborn »

gkoberger wrote: post #78
brutusborn wrote: post #62

Earlier quoted context omitted.

Why should we not expect organizations to give something back?

I answered that already. Because they paid taxes and employed people. It's like an insurance company that drops you as soon as you file a claim... you pay into a pool, expecting it to be there when you need it. This is an unheard of situation, don't forget. The government (rightfully so, in my opinion) is forcing these restaurants to shut down dining. It's not like they're shutting down because they're "lazy".

Businesses don't pay taxes or employ people in the expectation of being bailed out, they pay taxes (like everyone else) in the expectation of goods and services from the Government. You may expect bailouts for restaurants as a Government service, but the vast majority of people do not.

As a business owner in a 1st world country, for paying taxes I expect infrastructure, security and a functioning legal system.

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