“Banks often give better financing terms if a landlord can bring in what’s called a credit tenant — a national brand like a…
“Banks often give better financing terms if a landlord can bring in what’s called a credit tenant — a national brand like a Starbucks or a Target. That’s because even if a big chain winds up shuttering a local store, the parent company is still around to pay the rent. “If a T-Mobile or a Verizon choose to close a store, the landlord knows they’re good for it,” says Larisa Ortiz, a managing director at Streetsense, an urban-planning consultancy. You’d think everyone involved would be motivated to fill an empty storefront — landlords aren’t making money, cities aren’t getting taxes, and the neighborhood has an eyesore. But that eyesore may actually still be profitable to the landlord and the banks. “In SoHo, something vacant isn’t necessarily vacant,” says Ortiz. “Someone’s paying rent there, and the landlord’s perfectly fine with it. It’s a vacancy to the pedestrian, but not to the landlord.””— Bank Financing and Bad Urban Planning Make the Retail Apocalypse Worse