I went off on a tangent in the Otto's thread and I wonder if more OlyBloggers in the downtown know could chip in to help. Here's what has been posted thus far:

Initial post: Is it just me or do the rents in downtown Olympia seem prohibitively high for small local businesses? I've read that Olympia has/had a 15% vacancy rate which is deemed acceptable. The only local thing I turned up on numbers was the Business Examiner's write up on Pierce County. According to it Pierce County (the entire thing) had commercial vacancy rates of 6.75% in 2007. Fife was their high at 14.29%.

I think the rental rates in downtown Olympia are cost prohibitive for too many local entrepreneurs which leads to an increase in vacant commercial spaces. Why are the downtown commercial real estate owners willing to accept the loss of income from so many vacancies?

Responses:

Mathias: they base their rent prices on the possibility of what Olympia could become, rather than what it is. Unfortunately there's hardly anyone really taking steps in turning that possibility into reality. Olympia can be great, and we're already paying for it, but we don't have it yet...

Guglielmo: One explanation is that property owners maximize expected rental income by forgoing low-rent leases in favor of the possibility of landing someone willing to pay considerably more. Doesn't make it "right." Just is. They are "speculative" vacancies in the landlords property portfolio.