I know this is commercial, but can be good if it drives down property prices and rents. I honestly think a lot of the benefits people want from universal basic income would equally come from just having lower commercial and residential rents. I recognize that's a big "just".
Busted retailers use bankruptcy to break leases by the thousands
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Re: Busted retailers use bankruptcy to break leases by the thousands
#22if only the government/bank could've put moratoriums top down, freezing all rent commercial and residential. We'd be in a much better place.
Now we have economic collapse, 40 million looming evictions, people will starve, and freeze, or die in a shelter w/ the pandemic.
Businesses are failing because they have to meet monthly recurring bills w/ or w/out actual sales receipts. They still need to meet payroll if they're even open.
Could've been stopped from the lenders down, instead of try to just throw money every which direction and see which sticks.
I'm for handouts for the poorest, but i think the other handouts were horribly done, and the loan program.
Re: Busted retailers use bankruptcy to break leases by the thousands
#23Man, with (currently) four comments mentioning that this is "what bankruptcy is for", I think the point of the article might have been missed. This isn't some sneaky "one weird trick", and that's not the reason Bloomberg is reporting on it. In fact, the tone of the article to me is, "yup, companies do it all the time, but..." And the "but" is: But the moves threaten to upend huge swaths of the real estate market and…
>ghost towns
...if rents don't fall. And maybe they should.
Re: Busted retailers use bankruptcy to break leases by the thousands
#24This will come back to haunt them. Good luck.
How so? I'm genuinely curious what the downside for retailers would be in this case. As opposed to staying in place and paying the rent.
Re: Busted retailers use bankruptcy to break leases by the thousands
#25Man, with (currently) four comments mentioning that this is "what bankruptcy is for", I think the point of the article might have been missed. This isn't some sneaky "one weird trick", and that's not the reason Bloomberg is reporting on it. In fact, the tone of the article to me is, "yup, companies do it all the time, but..." And the "but" is: But the moves threaten to upend huge swaths of the real estate market and…
isn't that the point of capitalism, the fit live the poor die? Let the poor malls die, if their business model fails. We shouldn't force a failed business to last longer than society needs it to, otherwise that's something beyond capitalism.
Re: Busted retailers use bankruptcy to break leases by the thousands
#26sohpet etmenin en iyi adresi ile tanışmanın zamanı geldi. https://www.mavisohbet.org/sohpet.html katılın.
Re: Busted retailers use bankruptcy to break leases by the thousands
#27Man, with (currently) four comments mentioning that this is "what bankruptcy is for", I think the point of the article might have been missed. This isn't some sneaky "one weird trick", and that's not the reason Bloomberg is reporting on it. In fact, the tone of the article to me is, "yup, companies do it all the time, but..." And the "but" is: But the moves threaten to upend huge swaths of the real estate market and…
isn't that the point of capitalism, the fit live the poor die? Let the poor malls die, if their business model fails. We shouldn't force a failed business to last longer than society needs it to, otherwise that's something beyond capitalism.
the point though they're making is that if they die, then it can massively affect the banks. The knock on effect could be huge.
Re: Busted retailers use bankruptcy to break leases by the thousands
#28This is exactly why we have bankruptcy! These businesses are failing and need to renegotiate their liabilities. This is expected and healthy if you want any retailers to have any hope of survival going forwards.
> This is exactly why we have bankruptcy!
You're not wrong, and under normal circumstances this would be a blip on the radar. However, the hundreds if not thousands of locations each of these companies plan to shutter will have an unprecedented effect on the commercial real estate market. Within months we will have thousands of property owners suddenly unable to pay their mortgages because they no longer have tenants, meaning they will have to default on their loans. This will greatly affect banks and other lenders in the months and years following. It's a domino effect that will be felt for many, many years after we've wiped out SARS-CoV-2.
Re: Busted retailers use bankruptcy to break leases by the thousands
#29It's basically the definition of bankruptcy that you need to renege on your obligations to someone. Landlords run that risk. They're hardly the ones losing the most -- think of the poor creditors and shareholders. The landlords are only losing the expense of finding their next tenant, plus any difference in the market rate when the original lease was signed and today.
I think everyone loses regardless, but I don't think we should prop up businesses, capitalism should be a game that you play to win or play to lose.
Government needs to stop getting involved period. Help at the bottom - prop up the citizens who the government IS responsible for, let the rest duke it out. Corporations are not citizens. Government has no duty to help corporations.
But, yeah everybody will hurt by this, sure. Malls will close, businesses will close inside malls, investors will hurt, and workers who worked at those businesses lose, even some consumers who enjoy malls lose, cities lose because they become blight, many probably get abandoned and become gang hideouts or something. Homeowners lose because home values drop, but lots of other factors will be causing a lot of the cycles above to happen to. Next 10 years is a hazardous wasteland for prosperity.
Should just start bulldozing some of them and building green spaces and parks. I have a feeling open air is going to be a big trend over the next decade (less chance of viral spread).
Re: Busted retailers use bankruptcy to break leases by the thousands
#30Man, with (currently) four comments mentioning that this is "what bankruptcy is for", I think the point of the article might have been missed. This isn't some sneaky "one weird trick", and that's not the reason Bloomberg is reporting on it. In fact, the tone of the article to me is, "yup, companies do it all the time, but..." And the "but" is: But the moves threaten to upend huge swaths of the real estate market and…
>ghost towns ...if rents don't fall. And maybe they should.
I think I've seen it stated that property developers and property-management companies are often heavily leveraged, such that they can't lower rents; in about the same way that a VC firm with a ten-year investment time horizon on their fund can't invest in your startup if all your valuation-growth will come only after 11 years.
In both cases, the lenders and shareholders of the firm, have contractually obligated the firm to have specific returns (and often have built financial instruments on top of those predictable returns, which is why they bothered to invest in the first place!) So the firm itself is destined to either return the predicted profit, or die, with no middle road.