Rising rents are threatening to force bar and restaurant operators to relocate to other districts
Landlords of SoHo shops are showing signs of putting the brakes on rent rises because they threaten the bottom lines of bars and restaurant operators.
Rents in the district have increased more than 50 per cent since the beginning of this year, so landlords are expected to soften their stand because more food and beverage operators are on the verge of closing down.
An operator of a Mediterranean food restaurant on Elgin Street is expected to close soon because the new landlord who bought the property in June is raising the rent by 125 per cent to $90,000, from $40,000, according to real estate agents.
'The new landlord bought the shop for $16 million, he has to charge higher rent to justify the rental return. However, there's no way the restaurant will accept such a raise,' a real estate agent in the district said.
Last year, secondary market transaction prices for similar shops were about $9 million each, he said.
According to property consultant Chartersince Realty, the asking rent for a 1,000 sqft shop on SoHo's two main streets - Elgin and Staunton Street - is up to $80,000 a month.
