Friday, January 18, 2019
It is remarkable how much public money is poured down the "study" rathole on behalf of private enterprise profit. Most of the problems of State Street are specifically known from many previous "studies." First, the landlords want too much rent. Second, the landlords (generally hedge funds) are more interested in the potential appreciation of their assets than in year-to-year profit, so they are comfortable keeping rents high and buildings empty to pretend they have risen in value. Third, most of this has to do with the U.S. tax laws that hugely convenience such investments. But the scary probability is that a study conducted by a private enterprise company with the goal of private enterprise profit will almost certainly be a recommendation that the taxpayers in general put up more to support these private investments/businesses/speculators.
Had the free market been left to work in this business arena (and it has not since at least the time of the establishment of urban renewal zones decades ago), the cost of these properties would have fallen due to competitive pressures; rents would have fallen to the point that small businesses (not dependent on the ridiculous profits possible from alcohol service) could have set up and created a eco system to support other such businesses. This would have attracted reliable customs during normal daytime business hours.
Closing off State Street as a Universal City Walk tourist zone will be just as successful as L.A.'s Olvera Street.
The best thing to do is to go cold turkey and remove the support for this corrupt model and then start over letting the chips fall where they will and market forces set the rules.