It’s very clear there is no commercial property investors here, nor commercial borrowers.
There’s no actual problem here to be solved. If people feel they have better uses for a property they should put their money where their mouth is.
i see this all the time in china and in developing countries in general. they build huge malls, and then they can't fill them because there are not enough businesses who can pay the rent being asked. at least there is growth and the place will fill up eventually. but until that happens the place is less attractive.
seeing the same in europe in malls or shopping streets is even worse because it feels like the economy is declining. you have to apply the broken window theory here. the more shops stay empty the less people will go there to visit the remaining shops. their revenue goes down, they can't afford the rent anymore and another shop is empty. if this becomes a trend then you risk that the shops will never come back.
it is therefore in the interest of landlords and the city to keep the streets alive and fill them with businesses that attract people.
ignoring this problem is just a sign of greed. instead of building a vibrant space they just want to extract as much money as possible.
instead of being forced to foreclose the banks should be forced to extend the loan and eat the loss. foreclosing will cause them a loss too. so the banks are not better off either way.
the article says the building is an income stream.
no, it isn't.
the building is part of a community. the needs of the community top your need to make a profit. yes, this means the community should probably contribute to make your work financially viable, and one way they can do that is by making policy that gives you more reasonable conditions to pay off your loan so that a foreclosure is not necessary.
Everything else is your own opinion, which of course is fine.
the problem is not that i can't afford it. the problem is that NOBODY can afford it. free market rules then suggest that the value of that thing goes down and thus the price should go down too if the building owner has any interest in selling that thing.
and here is where the free market idea causes a conflict, because if they don't have an interest to sell then their interest and the city's interests are misaligned and the city should force the building-owner out.
or, you could also argue that the city itself is a market participant, because the city owns the land the shops are built on, and it leases or sells that land with specific expectations, namely that shops are built and rented out. if the renting out does not happen then the city's contract with the builder is violated and the city should have a right to take action.
Now you're proposing a different ownership model completely or that a government/city should be able to force a legal owner out of their legally owned property?
Honestly I think you need to back up and really consider what you're proposing.
basically you act like the error in my idea should be obvious, and i should be able to figure that out by myself. well, no, because if i could, i already would have. i don't write stuff without thinking about it. it may look like that to you, but only because you seem to know something that i don't. please share.
and what do you mean by no actual interest? have i not explained my interest? do you think the interests of the people living in the city are irrelevant? only owners and tenants count? well, most certainly not. but if you do not accept that the city and its inhabitants should have an interest in this matter then our problem is that we have a fundamental disagreement in our worldview.
No one’s outlined a scenario where the bank or the owner are violating some law/regulation.
Can’t wait for people here to begin arguing Elon should just sell/give up his equity because Starship hasn’t launched successfully yet.
Not everything needs to make sense to a bunch of IT peeps so, politely, either genuinely learn about commercial property or take a hike.
this is not just about how commercial property works, but this is about how urban planning works.
you keep insisting that i am a non-interested party. i am speaking for the city and the community. please explain to me how they are non-interested parties.
the needs of the community outweigh the needs of land and building owners. as an owner you are to serve the community. if you don't want to do that then you have no business being part of that community. we'll try to work with you to find an amicable solution, but if you refuse and leave your building abandoned then we can force you to sell. laws to that end already exist. they are used sparingly, but they are there if we really need them.
Plenty of the same type of commercial properties exist right next to each other, happily too.
Location still matters, as it does for residential, proximity to employees, or customers is important.
Zoning restricts what land can do what.
There's many reasons why this isn't a "free market"
Someone bought an asset they could afford to hold in bad times. End of story.
The article outlines the methods used for the most part to the best of my knowledge, as someone who owns and deals in this space.
I think you need to lay out a better argument for why your thesis is the case when what happens in the real world mirrors what the article discusses. Not to mention people forget property can be owned without a bank/loan, nor that vacancies are expected/factored in.
Markets clear at a price, pay that price. It’s just not the one you want.