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Working From Home - Impacts of Coronavirus

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coppice:

--- Quote from: AndyC_772 on July 16, 2020, 11:55:43 am ---Here in the UK retail has been struggling for years now; both commercial rent and business rates (property tax) are still set at levels which reflect how profitable retail space used to be. They've not been reduced in proportion to the actual profit that a given retail site can now be expected to generate.

Unfortunately that means there are a lot of retail spaces becoming (and, crucially, remaining) vacant. The law of supply and demand might mean that commercial rent will come down in time, but that doesn't really apply to taxes.

--- End quote ---
In the UK retail has several elements in conflict with each other. A key one is that retail parks around the edge of towns have been sucking customers out of city centre retail locations for decades. Now people tend to just focus on the effects of on-line purchases, but retail has been evolving, with changing winners and losers, since cities began.

coppice:

--- Quote from: dunkemhigh on July 16, 2020, 11:59:45 am ---Corner shops were already residential - they are basically homes with a shop in the front room, except where they used to be like that and got refurbished as mini-supermarkets.

--- End quote ---
Most corner shops in the UK were built to be corner shops, zoned and taxed as such. The shopkeeper frequently lived above and/or behind the shop. Again this was frequently planned into the design of the building, which often doesn't have a security barrier between the shop area and the home area. There are, however, quite a lot where the shop and the accommodation were built to be used as completely separate entities. I think those are mostly later built ones, where the shop keeper could make enough money to be living in a nicer area. Now that the entire building is residential its usually easy to see from the facade what its origins were, as they tend to do these conversions at minimal cost.

EEVblog:

--- Quote from: coppice on July 16, 2020, 11:50:03 am ---
--- Quote from: dunkemhigh on July 16, 2020, 11:23:13 am ---I don't think he implied the government would just take them. The landlords likely wouldn't care where their rent comes from so long as it's comparable, and the reason many commercial properties aren't luxury abodes is down to zoning rules. Relax those, let the rich gits live in the city centers and that frees up affordable housing away from town.

Or probably not, but the government can induce change-of-use without actually wrenching properties from their owners.

--- End quote ---
Commercial rents are really high, so owners are not going to repurpose property as residential unless they have lost all hope of revitalising some kind of commercial use. Where owners have really lost hope for commercial use of their property it has already become residential. For example, most of the traditional corner shops, pubs and many churches in the UK are now someone's home.

--- End quote ---

Unless it's a standalone commercial property on it's own land with a single owner, it will be strata owned (at least that's how it works here). And it's almost against strata policy for anyone to live in a commercial premises. So even if the government wanted to pay it would require the majority of the strata committee to agree. And as you say, most owners are not going to give up long term commercial rental gain for short term rent. And once people start living in it then "there goes the neighborhood" so to speak.

EEVblog:

--- Quote from: AndyC_772 on July 16, 2020, 11:55:43 am ---Unfortunately that means there are a lot of retail spaces becoming (and, crucially, remaining) vacant. The law of supply and demand might mean that commercial rent will come down in time, but that doesn't really apply to taxes.

--- End quote ---

People who own commercial property usually have a very long term outlook on things. Going without rent for 6 month to a year between tenants is not uncommon. This is why most commercial owners want the longest lease possible.

nctnico:

--- Quote from: EEVblog on July 16, 2020, 12:15:46 pm ---
--- Quote from: AndyC_772 on July 16, 2020, 11:55:43 am ---Unfortunately that means there are a lot of retail spaces becoming (and, crucially, remaining) vacant. The law of supply and demand might mean that commercial rent will come down in time, but that doesn't really apply to taxes.

--- End quote ---

People who own commercial property usually have a very long term outlook on things. Going without rent for 6 month to a year between tenants is not uncommon. This is why most commercial owners want the longest lease possible.

--- End quote ---
But in the end you'll need tenants. Over here online shopping is killing retail and the Corona crisis has accellerated that. Many older people who used to go to shops are now shopping online and it remains to be seen whether they will be going back to the shops now they found out about online shopping (which usually has a much much wider choice compared to a shop).

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