This one has legs because it plays into the "landlords are evil" vibe, but it makes zero sense. There are thousands of landlords in any given city, if not millions. It's not uncommon for a local landlord to only own a single building, and even the ones that own multiple properties will almost never exceed a single digit percentage of local real estate. The exceptions are things like company towns which is just not what anybody is talking about here. But if you own 0.3% of the units in a city, withdrawing some of your units from the market is not going to materially affect the city-wide rental price for the other units.
The evil thing the landlords do is go to the planning and zoning boards and lobby to prevent anyone else from increasing the supply of local rental units.
I actually think this one is pretty accurate for commercial real estate in particular. I’m in Metro Detroit and either a building is a totally dilapidated wreck in an area that has theft problems, or it’s going for $1~3 per square foot per month on triple net terms (leasee must do all upkeep, pay utilities, etc), which comes out to $100000/year in rent before utilities and such for an empty concrete shell. Worse than that, none of the places anyone lives are anywhere near anything available, so I can’t rent something for a nice big woodshop. At the same time, I can’t build a decent thing as a “garage” on my 2.1 acres due to zoning in my municipality from 25 years after my house was built. At the same time, there’s a bunch of buildings sitting empty with no rent paid. This means that landlord cost structure for light industrial is completely different than you seem to suppose or there would be competition and prices would come down…
I'm not entirely sure what you're even arguing here:
> I’m in Metro Detroit and either a building is a totally dilapidated wreck in an area that has theft problems, or it’s going for $1~3 per square foot per month on triple net terms
That makes a certain amount of sense. If a building is completely wrecked then the landlord would have to spend a lot of money to improve it, but isn't going to do that if it's in a bad area that couldn't command higher rents even if it was in better condition.
> Worse than that, none of the places anyone lives are anywhere near anything available
Again what you would expect to happen if they weren't purposely withholding units; units in higher demand areas are all rented out and the vacant units are vacant because nobody wants to be there.
> At the same time, I can’t build a decent thing as a “garage” on my 2.1 acres due to zoning in my municipality from 25 years after my house was built
Again consistent with the evil thing landlords do being to lobby the government to prevent competition, rather than not renting out units they could profitably rent out.
> At the same time, there’s a bunch of buildings sitting empty with no rent paid.
But you have yet to establish why. Are they units nobody wants for some reason? Are they "empty" but actually rented out, because some company signed a long-term lease before COVID and now they're WFH so nobody is there, but the lease doesn't allow subletting?
The inverse of the latter could also explain a lot of it for commercial real estate. Companies typically use long-term leases with defined terms because if they move in they're going to have significant expenses to install office furniture, wire up all their computers and cameras and things, put up walls where they want them etc. They're not going to do that in a place that could jack up their rent a year after they move in, so they demand a long-term lease with a defined rent.
Now the landlord has a problem. WFH is still a thing and it's harder to find commercial tenants, but they don't want to provide a new tenant with a huge discount in a long-term lease if they're predicting WFH will go away and they'll be able to demand higher rents in a year or two. And maybe that's cope, but it could still be why they're doing it, at least until they've sacrificed enough income to realize that WFH isn't going away.
Or it could be something else, but "landlord with twenty buildings thinks they can significantly increase city-wide rent by not renting out some of their units" is still nonsense. If it's happening at all it's only because those landlords are the proverbial fool and their money, not because they've devised an evil plan to profit from screwing people, because that evil plan screws the landlord doing it more than it screws the tenants.
Again, their actual evil plan is to prevent other people from putting more units on the market, by lobbying for zoning restrictions that inhibit new construction. Not by foregoing their own profits on their existing units.
There could be honest but non-obvious reasons. Maybe they need multiple renovations before they can get a certificate of occupancy but the local permitting office is Kafkaesque, or the site needs environmental remediation before it could be rented but the owner doesn't want to deal with it so they're trying to find a buyer instead of a tenant, or they have to finish suing the previous tenant who messed up the unit before they have the money to fix it, or the landlord took out an adjustable-rate mortgage right before interest rates went up and WFH started and is now bleeding cash and waiting to see if rates come back down to decide whether they want to invest new money in finding tenants or just file for bankruptcy.
One of the serious possibilities is that they're dumb. Lots of idiots exist, some of them buy real estate. They're asking for more because they erroneously think they can get it and then they're wrong so the unit is empty. They eventually either figure this out and lower the price or they run out of money to pay the mortgage and the bank comes for them, but either of those could take an arbitrarily long period of time.
The evil thing the landlords do is go to the planning and zoning boards and lobby to prevent anyone else from increasing the supply of local rental units.