Posted by
arrigoa
16 yrs ago
So now that we have lost Cru, albeit temporarily, it seems that Boca Soho will suffer the same fate! Management have advised that May will be their last operating month and they will seek and move to a new location during the course of the year. All I can say is I will make sure I get to enjoy Boca before they move on. (and yes as a result of owners demanding an unsustainable rent increase)
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Ed
16 yrs ago
I always wonder if landlords that bump there rents dramatically end up getting their price or they end up with an empty space for a few months then drop the ask down to something more reasonable...
Or perhaps what happens is they solicit offers through their agent before deciding on the rent hike... if the current tenant doesn't accept they immediately sign up a new tenant...
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It may well be a combination of both, and looks like a bot of a lottery in how they go about things. It's just sad to see a local business forced into relocating, although having said that, Globe has done very well out of it when they moved!
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Wise words from Ed about the empty space.
We had to move out of the apartment we loved a while ago because we couldn't afford it when the lease was up. We were willing to pay a premium to live there but they just refused to even budge from their level. Joke is on them of course. Now the unit has been vacant since mid-November with no sign of new tenants. Even if they sign a new lease right now they've still lost more from the empty months than they would have by lowering the rent. And let's not even mention renovation costs for a new tenant. It's completely absurd.
One explanation which I heard is that properties are valued based on the rent that is charged. So if they lower the rent this (over many properties) lowers the valuation of the company, and thus the share price. I don't know how much truth there is in that.
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Ed
16 yrs ago
You are indeed correct on that axptguy...
I recall a listed company with a building on Kennedy Rd who refused to budge on rents after the market had gone into a prolonged slump even though neighbouring properties had come off their highs substantially...they seemed not to mind that half the building remained empty...
A friend at CLSA explained the reason and it's pretty much as you indicate...
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no difference orangeman, but then again, people who drink there usually don't bother about 65 HKD and would feel annoyed to have to walk to 7-11
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Agree, the 7-11 in LKF must be the most profitable one in all of HK. The people that buy their beers at the 7-11 will never go in those bars anyways, and the people that go into the bars will not buy 7-11 beers either. To different markets. Typical HK feeding frenzy.
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yes agree, orangeman, to me there is no such thing as overpriced rents...
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hmm
16 yrs ago
Yep, we too loved our old flat. Owner had passed away while we were in the middle of a lease and it went into probate and we tried to work something out with the son (who would eventually own it) and the bank who held it... they just wouldn't budge on their demands for a huge hike and we had to move out... turns out because it was going to be in probate we were actually the only ones in the world who could have continued to live in it for some legal reason... they weren't allowed to sell it to anyone and it sat empty for more than 3 years... greed, greed, greed.
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