I am very disturbed by the City Council’s consideration of a commercial vacancy ordinance as a remedy for so many vacant storefronts, and the lack of vibrancy in the central business district. I am a commercial real estate professional specializing in retail leasing for 42 years, starting my career on State Street downtown in 1981.
As Ernie Solomon has said — and is exactly right — the market, and only market demand, determines whether tenants occupancy these empty spaces. In a natural economic setting, there is some basis for landlords lowering their rental pricing to attract new or national retailers, only provided the numbers make economic sense. I am sure the Santa Barbara landlords would follow what is often done, concessions if there is tenant interest from a strong retailer or a small businessman.
Being forced to lower rents with your approach would only devalue the buildings multiple times, and a tenant may still not be able to operate due to startup costs they must pay the city for their entitlements. You can’t simply — and only — calculate the monthly rates, but rather first the cost to both landlords and their prospective tenants of permitting their spaces for occupancy.