My business partner and I were hired as consultants to help an industry stay in business in Arizona. The industry, Payday lending. Regardless of whether you think it is a good or bad industry, the issue at hand is the amount of space they lease in our market and the owners that rely on them to pay rent.
There are approx. 500 stores in Maricopa County (Phoenix MSA). The average store size is just under 2,000 sq. ft. The law that lets them operate in Arizona sunsets in June of this year. The legislature did not do what was necessary to keep this industry in business. So, just like that, almost 1,000,000 sq. ft. is going to come back on the market for lease! A lot of these properties are single-tenant properties.
Now, here comes the snowball affect on the market that I am positive the legislature did not consider:
- Owners-they rely on the tenant to pay rent & cams to make their mortgage payment and live off the cash flow (having being a consultant on this issue, I know a few owners personally that rely exclusively on these tenants to cover their retirement)
- Clients of this industry-where can they go to get a loan for up to $1,000 for a 2 week time frame for around $150?
This has me thinking, what other industry is out there that could come under attack?