Abstract
This article examines how the law can help reduce retail vacancy rates in volatile urban real estate markets. Two potential drivers of high vacancy rates along retail corridors in otherwise healthy real estate markets are identified: (1) location risk, and (2) positive feedback effects. This article suggests that local governments can pursue a nudge‐based approach to encourage landlords and retail tenants, especially small business owners, to adopt percentage rent or some other form of profit‐sharing to more efficiently allocate location risk. To address positive feedback effects in which each storefront vacancy increases the likelihood of an additional storefront vacancy, a case is made for stronger government intervention.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.