# Empty storefronts



## eastwind (Jun 18, 2016)

Where I live, Cancun, there are lots and lots of retail shops that are unoccupied. The remains of closed-down businesses are everywhere, falling apart, covered with graffiti, looking totally abandoned. Even prime locations with massive foot traffic have lots of vacancies. 

Is it that way everywhere in Mexico? I know Hurricane Wilma was really hard on the economy of Cancun and that the place has never been the same since, so I'm wondering if all this vacant space is a result of Wilma or Cancun overbuilding or if it's just the usual thing in Mexico.

I know property taxes are very low, so I guess the cost to a landowner of letting a property just sit and rot is low. In a more normal economy commercial rents would decrease, but from conversations with a local businessman that's not been the case, landlords prefer to let the properties sit vacant for years than lower their asking rates. If that's true, I'd expect it to be true throughout Mexico, not just here.

In the year and a half I've been here, I've noticed a few places get renovated and reopened. Usually they tear everything down all the way to the concrete, including tearing off the roof, but leave the concrete structure in place and build out again in the same shape as before. If this is at the expense of a renter business occupying the building they are paying a huge move-in premium and risking a lot of capital to start the business. If the property has been bought it makes a little more sense, but why let everything fall so completely apart in the first place?


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## lat19n (Aug 19, 2017)

Not seeing that here - unless you are talking restaurants. We are creatures of habit and tend to stick with businesses over time, and I can't think of any that have gone out of business. 

It really is AMAZING the number of new medium sized (and some large sized) malls going up in our area. The number of new auto franchises going in is incredible. Had I known that Volvo was coming to town I might have thought twice before buying the Subaru - who have never come here.

On our occasional to frequent trips into Mexico City I always judge the state of the Mexican economy by the number of tall construction booms in the skyline. Mexico is not in any sort of slowdown...


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## surabi (Jan 1, 2017)

No empty business locations in Sayulita and constantly building more.


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## perropedorro (Mar 19, 2016)

eastwind said:


> I know property taxes are very low, so I guess the cost to a landowner of letting a property just sit and rot is low. In a more normal economy commercial rents would decrease, but from conversations with a local businessman that's not been the case, landlords prefer to let the properties sit vacant for years than lower their asking rates. If that's true, I'd expect it to be true throughout Mexico, not just here.
> 
> In the year and a half I've been here, I've noticed a few places get renovated and reopened. Usually they tear everything down all the way to the concrete, including tearing off the roof, but leave the concrete structure in place and build out again in the same shape as before. If this is at the expense of a renter business occupying the building they are paying a huge move-in premium and risking a lot of capital to start the business. If the property has been bought it makes a little more sense, but why let everything fall so completely apart in the first place?


I live on the Pacific Coast, and if you've got property near the beach letting it sit isn't an option. Unoccupied, maybe, but any structure still requires regular maintenance because the salt-laden moist tropical air will find its way into any crack in the cement and start to destroy the rebar quick, fast, and in a hurry. We seal the roof every year and have cracks and holes in the walls repaired asap. Once there was a 2 story beachfront hotel in town, not too prosperous and already showing age. It shortly closed for good and was left to rot, becoming structurally unsafe within three years. It had to be tumbled down five years after that, but Mother Nature already did most of the work.


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## citlali (Mar 4, 2013)

No I do not see that in the Chapala area ir in San Cristobal de las Casas, sounds like Cancun overestimated their needs.


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## chicois8 (Aug 8, 2009)

I would thing local gangs working for the cartel are pressuring local shops for more money for protection that they can afford hence they go out of business, when I lived in Guayabitos if the palapa restaurants did not pay it would mysteriously have a fire one night.....I know a hotel owner in Mazatlan and she told me of the many restaurants that have closed .........


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## perropedorro (Mar 19, 2016)

chicois8 said:


> I would thing local gangs working for the cartel are pressuring local shops for more money for protection that they can afford hence they go out of business, when I lived in Guayabitos if the palapa restaurants did not pay it would mysteriously have a fire one night.....I know a hotel owner in Mazatlan and she told me of the many restaurants that have closed .........


Seems like Mexican insecurity in general is blamed on the cartels, and I don't quite follow it. Cartels are in the business of moving illegal drugs, and quite a bit of it. So why is an outfit that already makes obscene amounts of cash putting a protection squeeze on palapa restaurants and abarrotes?


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## Isla Verde (Oct 19, 2011)

perropedorro said:


> Seems like Mexican insecurity in general is blamed on the cartels, and I don't quite follow it. Cartels are in the business of moving illegal drugs, and quite a bit of it. So why is an outfit that already makes obscene amounts of cash putting a protection squeeze on palapa restaurants and abarrotes?


Cartels are in the business of making money any way they can. I know that in Mexico City there are many areas where small-time criminals make money by offering "protection" to small businesses. If they don't pay up, they are soon out of business, unfortunately.


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## citlali (Mar 4, 2013)

yes, palapa restaurants and abarotes also get hit. A friend of mine who does business in Tulum told me that the businesses there have to pay so I would say it is the same in Cancun, Playa del Carmen and so on. Some people who do not make lots of money just close shop.


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## chicois8 (Aug 8, 2009)

perropedorro said:


> Seems like Mexican insecurity in general is blamed on the cartels, and I don't quite follow it. Cartels are in the business of moving illegal drugs, and quite a bit of it. So why is an outfit that already makes obscene amounts of cash putting a protection squeeze on palapa restaurants and abarrotes?



You see the cartels have so many losses they need a place to obtain new members, the perfect chain of command is start in a local gang, become noticed as a good earner and be selected to join the big boys...


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## perropedorro (Mar 19, 2016)

Got it. I always figured "cartels" were big-time drug importers headed by guys like Chapo. Apparently they're also low level street gangs scratching an illegal means any way possible, whether it be extorting from mom and pop businesses or pickpocketing cellphones on the Metro. Just a matter of semantics.


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## sunnyvmx (Mar 14, 2010)

I was friends with a nice Mexican lady who set up a sidewalk stall in a small city on the East coast of Veracruz State. She sold good clothes bought cheap from large warehouses in Laredo and her business did well with steady customers. One day a young man appeared and told her she needed to pay for protection. She closed her stall and took her business home. Her customers followed and bought there. One day a police officer appeared and told her she needed to pay for protection. He threatened her family and home. She gave all the clothes to another family member in another town. I had spent a morning with her going from place to place while she attempted to collect from her clients. I asked her why she sold on credit if they predictably didn't pay. She said, "They are good customers!"


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