Eli5: Why are so many office blocks and retail shops in UK that are ” to let” remain empty for months, rather than to reduce rent ? Why do landlords do this?
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Not sure of all cases, but a client’s office tower offers huge rebates if a tenant will sign a lease at a higher sq footage rate. Something like, sign the lease at $100/sq ft and receive a signing rebate of 30%. That way they can claim they rent space at the higher rate and it increases the overall value of the building. Renting space out at a discount would lower their value per sq ft and attract lower quality tenants.
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