High Rents Affect Small Business
One trend is clearly visible today. Hi rents are driving many small businesses out of existence in the Pasadena area. The affected groups are restaurants, retail and service establishments. Landlords in the area are not as sensible to small businesses as their counterparts from the beach cities. The result is that many establishments are replaced with For Rent signs.
An unscientific survey among local business owners reveals that loss of revenue and high rent are the main reasons driving them out of business. Today’s bad economy does not produce high revenues. Vast majority of businesses are affected.
While property owners in the affluent coastal areas responded with lowering the rent rates to $1.50 – $2.50 per square feet, tenants in the Pasadena area do not feel the same effect. Many landlords still hope that the economy will turn around soon and business will continue as usual. The result of this thinking is visible in many for rent signs.
Current econimic conditions are challenging for both tenants and lendlords. Obviously, the former cannot support break even or money loosing businesses indefinately. It is interesting to see for how long the later can afford to have empty spaces.