Comment by scifi
6 months ago
True. What I don’t get, is how is vacancy a good move for the landlord? Wouldn’t it make more sense to have a tenant during that time?
6 months ago
True. What I don’t get, is how is vacancy a good move for the landlord? Wouldn’t it make more sense to have a tenant during that time?
Commercial loans are not like residential mortgages and often the loan is based on a minimum rent. If you go below that then you are in default.
How do they make mortgage payments without rent?
* own a portfolio of real estate, so losses in one area can be offset
* own a mixed use building, so an empty ground floor retail space can be offset by multiple floors of apartments
also, if the rise in equity outpaces the losses in rents it can still be net positive
I don't like just saying "read the article", but this is precisely what the article explains. In short: the rental rates are a condition of the property owner's loan.