not “so far under market” anymore is it?
Well the rental on a commercial property can be very significant in terms of the value of the property. In fact, it’s pivotal. This is why you see many commercial properties, especially in New York, where the landlord will allow the place to be empty, sometimes for years, waiting for some tenant to pay the insane ticket.
If you are saying that due to homelessness and sidewalk poop and weirdos in the neighborhood, that nobody in their right mind would pay what they once did for rent, that’s probably true.
But the owner of the building might very well want to jack the rent sky high in order to refi the building and then abandon it.
Yeah, there’s no question that an empty store generates nothing, but if some bank will lend the owner a ton of money based upon the jacked up rent, even if there is no actual tenant paying it, that is by no means a rare ploy. And likewise, if the owner reduces the rent by a load, the building devalues concurrently and may induce the current lender to call the loan or demand additional cash (or other real estate) collateral!