23 replies to this topic

[SacKen]

(Just my guessing based on some limited experience doing my own business taxes.)

If a company owns several properties, it is probably beneficial for tax reasons to claim losses on some of them. There's probably also a price-point where the lack of income is more beneficial than the rent collected, so it's not worth renegotiating to a value below that number.

There may even be ways to claim unpaid leases as Bad Debt. So a store closing and leaving a lease unfulfilled may be better than having an empty property with no active lease attached to it (current or in default).

Any CPAs with corporate tax experience in MyFolsom land?

[Agent_007]

stop assuming.

you don't know if the tenant was in arrears on rent. i don't know either so don't take this as a statement of fact. if they were, this could be the least expensive option out; close the doors and cut losses.

you also don't know if the landlord is facing foreclosure thus having no interest in the outcome of the building. don't take this either as a statement of fact because i have no knowledge.

also, the landlord may have a tenant in contract for that space and should the current tenant be failing to fulfill their lease terms there may be a performance dispute between tenant and landlord thus closing a business is less expensive than hiring lawyers to fight your claim when you already have constrained cash flow.

what i'm saying is the situation could be substantially more complex than you understand thus speculating is purely wasted time and energy.

commercial RE is being hit really hard right now and will be through this year.

any business less than 5 years old is feeling this recession immensely.

there is a reason the first owner sold. that might offer insight to what has happened but you really can't simplify what is going on. no one has any facts, just speculation.

[Lisa in Folsom]

I was told at the store today that their last day is this Sunday (Mother's Day).

They have had offers from others in the community to relocate. This may or may not happen, perhaps in the range of August.

Big sale. Very busy today.

[Jolene]

there is a reason the first owner sold. that might offer insight to what has happened but you really can't simplify what is going on. no one has any facts, just speculation.

Nope. Doesn't offer any.

(I knew the previous owners at the time they sold the store.)

[notsure]

We just spoke to the owner and she said they will be open until Wednesday. The owner offered them some discounts, but nothing worth their time. She said some prominent members of the community came by and said they will do everything in their power to help re-open the business.

[giacomo]

We just spoke to the owner and she said they will be open until Wednesday. The owner offered them some discounts, but nothing worth their time. She said some prominent members of the community came by and said they will do everything in their power to help re-open the business.

Wal Mart, Target, Kohl's, Costco, Sam's Club, Lowe's and The Home Depot etc....these are the primary reasons so so many mom and pop stores are closing.... such a shame. My daughters shopped at Periwinkle's many times and not just for Webkins either. I wish them the very best

[Mommy2Sydni]

From what it sounds like.....they will re-open sooner rather than later...they have been looking at other locations....

[lexmom]

I hope they re-open. That was my "go to" place for gifts.

[Acornjulie]

Regarding the inflexible Landlords, I had the same question and finally got it answered by a commercial broker. Let me see if I can accurately restate it here...

A Landlord bases a lot of things on his/her "price per square foot" he/she is currently receiving, meaning, they only average the rents that the landlord actually receives. Everything fomr asking price on empty spaces to Bank loans, mortgage rates, etc. are all based on this average, and that's why they prefer less spaces filled for more cash.


But yeah, seems crazily short-sighted to me as well.