May 16, 2020
The piece tells readers that small businesses in cities with high rents face a serious risk of bankruptcy. The point is very clear in the headline, “small businesses in high-rent cities face disaster. If they go under, urban life will change.”
The obvious problem with this story is that if large numbers of businesses go under, then it is hard to see how rents stay high. Landlords may not be the smartest folks in the world, but it doesn’t take a genius to realize that you get more money from a rent that is 20 or 30 percent lower than from a vacant building. If rents drop sharply, the high-rent cities would no longer be high-rent cities.
Of course, the Post could be right and landlords may not be able to figure out that they are better off with a tenant paying lower rent than not getting any rent at all, but that should really be the story. We have seen many stories in the Post and elsewhere about workers don’t have the right skills for the jobs that are available. This would be a clear case in which landlords lacked the skills needed to run their business profitably.