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Crisis has made taking of key money disapeared and caused fell of money transfer over 50%.

Crisis has stopped taking of key money.

Global crisis has affected not only real estate prices and rents, but also the transfer of securities commercial rental demand which has fallen down up to 50%.  Actually this money is an important part of movables circulation. This process was seen in the places of huge money income: markets, shopping centers and street’s shops.  That is why owners of property have started to get low front money or dismissed to take it. Trade places of shopping places which are getting free day by day catalyze this process. Owners are forced not to get key money because finding of a new leaser is too difficult. Mainly, in the some live districts of Istanbul as İstiklal Avenue, Bağdat, Nişantaşı, Etiler, Levent, Bakırköy owners are forced of front money because rental places stay free for a long time.

Crisis has made taking of key money disapeared and caused fell of money transfer  over  50%.
Incomes of private businessmen have fallen down.

Just in Istanbul was built 226 of shopping centers. Except this many of the housing projects include their own shopping centers. That is why in one moment offer of house rent has become bigger than demand. Also financial crisis has caused amount of non rental places. All of this made a good condition for renting without any front money. In spite of asking key money in the most popular parts of Istanbul this front money has fallen up to 50%. Nevertheless in situation when owner asks key money he waits much more than those who do not ask it.

In the districts of high population density and workers as  Kadıköy, Etiler, Beyoğlu, Bakırköy, Nişantaşı, Levent, Beşiktaş and Mecidiyeköy before the crisis offers of front money was  millions of dollars. Key money amount has started to became lower and lower in the third quarter of the 2008 year. In the beginning of the 2008 year front money in the Istiklal Avenue was between 100.000 of Turkish liras and 1 million dollars.  In the first two months of 2009 year this prices has started to change between 40.000 and 500.000 $. Rent of Turkish real estate from the dollar returned to the Turkish Lira. Before the crisis has started key money in the Bağdat Street was 1.5 million dollars. Nowadays it is nearly 150.000 dollars. Front money in the Abdi Ipekci Street has changed between 500 thousand and 750 thousand dollars. Before the crisis key money in Beşiktaş was nearly 500 thousand of TL but now it is nearly 100 thousand of TL.

According to experts Turkish real estate is under bad conditions. Empty shop places confirm this. Nowadays some owners which do not want to dismiss of front money tell that sometimes we do not take any key money or it is as low as it is possible. To find a rental shop on these street several months ago was very difficult. But during the crisis the most of shops have leaved. Unfortunately this numbers increase day by day. Owners are forced to dismiss key money.

According to speaking of Başak Soner who is a member of “Turyap” administration rent with asking of front money is about to disappear. “Instead of this method is better to speak about key money. Some time ago leaser before renting a store in the shopping center has given front money to owner. Before tenant will open a shop he paid rent and made decoration. But when the crisis started no one wanted to pay it.  That is why commercial streets again started to work and crisis slump became a chance. Today in particular regions numbers of shop places which can be rented are decrease. Many firms despite of difficult conditions may rent a store without any key money”, told he.

Forget front money, lets tenants be happy.

According to speaking of Sabri Ateş who is Real Estate Broker Chamber President of Istanbul owners are forced not to ask for key money. He noted that there is no ability to ask for front money at the moment because some tenants leave their live places. Asking of key money made people angry so owners have dismissed to do this.  Normal rent is glad to receive. Istanbul’s most important streets are empty the same thing happens to shopping centers.

News was edited by “VESTA Estate”

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