ELi5: Why commercial property landlords would rather have an empty property than offer a tenant a discount?

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Someone mentioned that for accounting reasons property portfolios may be better sitting empty than offering tenants a discount because their yields look bad?

In: Economics

8 Answers

Anonymous 0 Comments

This only applies to the U.K.

You only pay business rates on occupied commercial property. So if the property is empty then there is no rates to pay on it

Secondly the property is worth a multiple of the rental value. so if you reduce the rent, you reduce the book value of the property

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