33% Of Small Businesses Struggle To Pay Commercial Rent
USA – A survey by small business referral network Alignable showed that roughly one-third of small businesses across the country leasing commercial property were unable to pay rent promptly or in full two months ago, according to an S&P Global Market Intelligence report published on Saturday (9 July, SGT).
Aside from that, over 50 percent of the polled small businesses revealed that the rent of the commercial property they were occupying rose in the last six months. This is after lessors, who have agreed to rent deferrals and concessions during the virus outbreak, are now collecting due rent, while some even raised their rates.
Statistics from Marcus & Millichap showed that commercial property rent edged up by 4.6 percent in Q1 2022 as compared to the same period in the preceding year. Nonetheless, the average vacancy rate fell to 6.5 percent or the lowest since before 2015.
Although some commercial real estate landlords have increased rents, they may find it hard to do so, as tenants are already struggling with high inflation and most government aid programs have expired, noted Daniel Taub, National Director at Marcus & Millichap, a commercial property financing and advisory company.
Meanwhile, the Denver Business Journal reported recently that a 22-storey office tower at 1401 Lawrence Street in downtown Denver was divested by Heitman LLC to PGIM Real Estate for US$233 million. Measuring 309,987 sq ft, the office asset’s anchor tenant is law firm Polsinelli PC.
The South Florida Business Journal also reported recently that DRA Advisors LLC and CP Group acquired a Miami office building for US$163.5 million. In 2016, a unit of Sumitomo Corporation of the Americas purchased the commercial property for US$220 million.