Unlike rental apartments, market rents are applied to premises.

Most retail premises have rents that are increased annually by the same percentage as inflation in October of the previous year.

This year, inflation in October is expected to be a record high, around 10 percent, which means that the rents for shops, restaurants and other premises will be increased by the same amount at the turn of the year 2023. 

- This will not only affect the rent for a couple of months, but for all time to come, says Svensk Handels CEO Sofia Larsen.

Risking empty cities

In recent years, inflation - and rent increases - have been around 2 percent, which Swedish Trade thinks has been reasonable.

But with inflation peaks like the one we're seeing this year, this system doesn't work, they say.

Now they are warning that this will have a major impact on the whole community, and that premises are at risk of being empty.

- We will see completely different city centers in the future.

We hope that there is an understanding from the property owners, so that we can keep both jobs and viable cities around the country, says Sofia Larsen. 

Increased costs also for property owners

On the other hand, the opposing trade organization Fastighetsägarna believes that the prices are ridiculous even for those who own the premises, and that the tenants therefore have to pay more.

The rising interest rates are expected to affect property owners hard, as these companies are often heavily leveraged.

In addition, management costs increased by 18.5 percent between 2016 and 2021, while rents in the same period only increased by 8.5 percent. 

- There is a lot going on in our world around us and I think that you should be careful about discussing such long-term systems right now.

Basically, I still think this system works well, says Fastighetsägarna's CEO Anders Holmestig. 

However, Holmestig sees no obstacles for individual stores to negotiate with their landlords.

- We are mutually dependent on each other.

The property owners obviously want to have long-term relationships with their tenants, he says.

Hear store owner Helen tell about how a rent increase would affect her in the clip above.