I think if they manage to use the pandemic line along the whole chain, maybe they landlords could also negotiate some deferments or cuts with the banks, and the banks get some credits or leeway on other things for doing that, so on and so forth. If Apple really wants that cushion they could help with their expertise land a deal for the rest of the chain or explore ways for that.
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Apple Asks UK Retail Landlords for 50% Rent Cut Despite Record Sales
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Not similar at all. They stopped paying rent on valid contracts. Apple has offered landlords a deal that they can accept, counter or reject. In the meantime, they are paying their rent.
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you guys are absolutely hilarious in this thread talking about this as if the landlord was an old widow living alone with her cat. We are talking about some of the most expensive real estate in the world, in some of the most expensive avenues in the world, in the hands of some of the richest individuals on the planet. Almost all the most important real estate in London is owned by the princes and the kings of Quatar, Saudi Arabia, and the Emirates.
This is basically an issue of one of the richest companies in the world haggling with some of the richest individuals on the planet, and you guys are crying about it as if this was Jean Valjean in Les Miserables .
let the super-rich settle their first world issues between them.
« icky » ? « Obscene « ? Seriously ? Are you people all billionaires to get so upset about 2 billionaires haggling over a few hundreds of millions ?
Comedy Gold ! 🤣
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Half correct. They used a law that was made for private people to postpone rent payments because of corona. While the procedure was in fact legal the outcry came because adidas is a profitable company and if you are profitable you should not benefit from laws that were made for organizations/people that really can't pay rent.
One of the wealthiest companies with record earnings wants a 50% cut from smaller guys that will have a trickle effect on even smaller guys like reduction in jobs. The COVID-19 tenant protection laws were enacted to help citizens affected by job loss and not for wealthy profitable mega corporations to take advantage of.
Apple’s worth is larger than most countries. I find this Reprehensible in the current environment we now live. Regular folk are being kicked out on the street and Apple has the gaul to ask for their rent to be cut in half? Sorry. I know this is how the world works under the current capitalistic system. But the gap between the rich and everyone else has gotten so wide, and a few companies have gotten so big....something needs to change. A paradigm shift in thinking. I didn’t mean to go off on a rant here. Lol. But the economic devastation of ordinary folk I am witnessing all around me is getting me pissed off. Covid-19 has really exposed the inequalities that we always knew were there to such a degree that we cannot ignore it any longer. This isn’t just about Apple, but about our societies as a whole. How they are run by politicians that care more about their rich donors than the people they are suppose to represent. The crazy thing is that regular consumers are 2/3rds of the market. If We go down... The whole system breaks down. Usually we are kept numb. Comfortable enough to not challenge the system. But again...this virus has stripped the crumbling facade away. We cannot go back to the way things were after this. Change is coming. <end of rant> 😡
This is my perspective, as a commercial property owner:
When you lease property, you are primarily focused on getting a guaranteed return. You want to be sure that the tenant will pay the rent, but you also want a tenant that has a brand which attracts other tenants like them. You do not charge these tenants market rates because of the extra value that they offer. Apple is this type of tenant. Starbucks and Whole Foods would be as well. This is a fair system because no business owner is forced to lease from any particular property owner.
If I had the opportunity to lease my property to Apple, and if I was making even a small 10% guaranteed return — I would absolutely go for it.
When you lease property, you are primarily focused on getting a guaranteed return. You want to be sure that the tenant will pay the rent, but you also want a tenant that has a brand which attracts other tenants like them. You do not charge these tenants market rates because of the extra value that they offer. Apple is this type of tenant. Starbucks and Whole Foods would be as well. This is a fair system because no business owner is forced to lease from any particular property owner.
If I had the opportunity to lease my property to Apple, and if I was making even a small 10% guaranteed return — I would absolutely go for it.
I really don’t understand the reaction to this. I’m not a fan of a lot of Apple’s business practices, but this makes sense. Yes Apple just had a good quarter. But that was not due to same store sales. If same store sales are down in these locations, which I am sure they are, and the market allows for it, why wouldn’t Apple try to negotiate lower rent?
Regent street london leasing costs are no doubt the most expensive in the whole world. The landlord is lucky to have Apple as a store there. They have allowed lower rent for other retailers so they should for Apple too. Their record earners have zero to do with this. Apple should be able to pay the market rate like all other stores. The landlord will lose out even more if Apple leave as there will be few stores able to pay as much they have.
Regarding taxes, Apple have paid their legal share. If there is issue with that then it’s the governments fault for allowing it, not apples.
Because 50% is not reasonable. Apple will survive paying rent on empty buildings, easily.
Let's give that 50% to unemployed people/
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oops. I heard a rumor saying that the local cheesecake factory probalby stopped paying payment to landlord during this pandemic time.. getting 50% is probably a better deal...
You’re getting it. It’s a negotiation. That is an entirely fair repsonse, and one that is mutually beneficial.
And then you lost it. Lol.
If you're not aware of how Apple ranks in terms of sales per square foot/meter, you should really check that out. I don't have data other than anecdotal of the foot traffic generated, but I can tell you Apple is the ONLY reason *I* go to malls anymore. My guess is they draw a LOT of traffic, which as already been said, benefits other tenants.
If I am a Westfield or Simon - as a landlord, Apple is one of a few, select gold-mine tenants that I want. Obviously the landlord isn't going to take a deal that results in a loss for them, but to some degree an Apple store is going to help make or break any site it's at. All of these things factor into the tenant/landlord conversation. People are getting bent out of shape because they've seen the opening salvo. No one is going to get a 50% rent reduction, nor should they, probably. But they can get something reasonable, and the landlord gets something too.
They do. They pay their store employees even though their store employees have no stores in which to be employed right now.
But landlords are also affected by this pandemic and see losses on their income from tenants not being able to pay the rent. Why should we feel sorry for a trillion dollar mega corporation and not feel sorry for the landlord that will see a loss of 50% on the rent from apple? It goes both ways.
I don't see an issue here. Its quiet normal to renegotiate leases some time before they expire. Apple generally pays over the odds, so the property owners have been raking it in.
Sure Apple has made a good profit recently, but unlike a lot of other companies, its paid all its employees normally during shutdown, has donated over 10 millions of masks in the USA and millions more worldwide, as well as millions of USD to Covid-19 vaccine research not to mention donated to funds to support communities affected by Covid-19.
I don't see them as the evil empire.
Sure Apple has made a good profit recently, but unlike a lot of other companies, its paid all its employees normally during shutdown, has donated over 10 millions of masks in the USA and millions more worldwide, as well as millions of USD to Covid-19 vaccine research not to mention donated to funds to support communities affected by Covid-19.
I don't see them as the evil empire.
Maximizing value could very well mean taking the deal Apple is offering. The value of a mall that has an Apple store with a 10 year term years is much greater than the value of a 3 year lease.