Accepting a reduction in rent or losing the tenant? Need advice during COVID times.
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[{"id": "fwdqvwn", "text": "What is does the security deposit/guaranty situation look like? That can help alleviate the short term pain of reduced or lost income. My initial thought would be to agree to the temporary decrease in rent while simultaneously introducing a 180 day Landlord termination option into the lease. So if/when the market improves you can re-tenant.", "replies": [{"id": "fwfqg6l", "text": "I love the landlord termination option idea.   You agree to waive your termination rights as soon as they go back to original rent schedule.  This keeps them honest and doesn't screw up your plan to sell long term.  \n\nI also think the other comments about giving an honest assessment about their long term viability makes good sense.   If this isn't a business you would bet on coming back to  almost normal conditions, plan accordingly....all that said, I do agree something is better than nothing in most cases.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fwdyps1", "text": "I lease out multiple locations for various restaurants and cafes. The landlords response was fairly even across the board ( with us pushing obviously). We could not pay rent really while we were shut down during the initial part of the pandemic. The LL requested proof that we had applied for our ppp and our sba loans. They all basically wanted to see that we were being proactive and were at least trying to get ahead on everything. \n\nHaving that proof - and then paying June rent when we were finally open again - they retroactively charged 50% rent for April and May and amended our lease to pay that 50% balance between Nov 2020 and April 2021. Some would amortize to split that balance across varios months. Others just want us to pay as we can. This particular breakdown worked for us with the situation we found ourselves. No LL ( at least mine) want to deal with any evictions right now and for the most part - understand what's going on. They just wanted to make sure we were planning on sticking around. Even when approved for the PPP they didn't ask for the balance yet. the amendments stand. Probably a different situation for you, but this as tenants helped us out. It seemed 'fair' though I would have loved to not pay at all while closed but that's technically our issue and not the LL. \n\nHope this perspective helps a bit. There may be a structure your not thinking of in that.", "replies": [], "depth": 1}, {"id": "fwf4a7v", "text": "Is it a corporate guarantee or a franchise? \n\nThe people most aggressive on not paying rent have been the private equity people, while most mom and pops have scraped to pay. \n\nYou may reach out to other landlords with the same tenant to see what they did and what the pushback was.", "replies": [], "depth": 1}]