High Rents in Boston for Businesses: John McGeough on FOX25 Morning News
There have been a bunch of bummed out customers on Newbury Street who frequent the JP Licks location there, they recently learned that spot is shut down–no worries JP Licks is doing fine but they were forced to close that location because apparently the landlord is jacking up rent looking for a bigger tenant and JP Licks is not alone. John McGeough, the good looking half of Lamacchia Realty , did I get that right, according to their website anyway! He’s joining us live this morning to talk more about this and John we’re also hearing about the Purple Shamrock the location been down there at Faneuil Hall a lot of years and also looking at the possibility of them shutting down because of the situation the landlord is looking to jack up the rent are you finding that this is a trend out there now?
Not really, I mean JP Licks is as an example, is on the most ideal street in all of Boston, Newbury Street is kind of the Mecca of retail, you’ve got an international clientele, so that landlord has tremendous leverage. You don’t see that as you go farther out into the suburbs, if you’re looking at Framingham commercial space, I don’t see it as a trend but I understand it to some level.
It would seem to me if you’re a landlord you’d want to have a reliable tenant who’s been there and who has a customer base that they’ve already established, you’d do everything you could to keep them.
Yeah you would think that but I also think that JP Licks as an example they’re looking for a larger tenant, so they can rent out more space for slightly more money or even if it’s the same they can get more square footage rented out and it makes sense from a business perspective.
They talk about the housing market that this is a buyer’s market or a seller’s market, with the way things are going now with businesses is this a landlord’s market as opposed to a small business owner’s market?
I’d say it depends once again on the area, parts of Boston, say the Back Bay, you’ve got the lowest commercial vacancy rate really anywhere, it’s below 4% or right around 5%, I wouldn’t say that landlords have, they have leverage in those areas but I wouldn’t say once again as you go outside the city they have that same leverage. Not as much as buyers, especially in the residential space, home buyers still have tremendous leverage.
If you’re a small business and you’re looking for a place, you’re looking for a location what types of lease terms should you be looking at what types of things you might be able to get in this market right now?
I mean you want to look long-term, 5 years, 10 years, you’re always going to get better square footage rates you also want to try and do as much of the build-out: work that into the lease so there’s less out of pocket costs for you.
You’re talking about a build-out, growing out your store or designing it a certain way, such as shelving or things of that nature?
Knock out walls, raise ceilings do whatever you need to do to, but have the landlord pick that cost up so they can actually stretch the cost throughout the term of the lease.
If you are looking now you can get a pretty good deal and of course as always it’s location, location, location.
Sure, I mean JP Licks is just moving over to Charles Street in Beacon Hill so they’re going to do fine, and once again Newbury Street is kind of an aberration.
Well they call it the high rent district for a reason, John McGeough appreciate your insight this morning as always, thanks for your time,
Thanks for the compliment!
You’re quite welcome, that’s what others told me! Just going with the facts! But don’t tell Anthony that.
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