Reducing The Rents

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Has anyone here had to reduce their rents for their commercial tenants to keep them a float in these tough economic times? When a major tenant approaches you about reducing the rents what do you do? Do you tell them to honor the contract or do you give them a break?

Comments(4)

  • rglover54830th January, 2009

    1st ..You reduce your rent and offer a couple of hundred in improvements.

    2nd ..If that doesnt work out...then u have no choice but to enforce the contract.

    I wouldnt try 2nd - 1st in todays market.

  • johnmckee6th February, 2009

    170 views on this topic and no further comments??? Come on gang, let me hear your stories about tenants going out of business or reducing the rents in order to survive in this economy. How are you juggling these situations as a landlord?

  • rglover54810th February, 2009

    Unfortunately, you are on the wrong side of current politics and economics. Todays commercial tenants are difficult to replace, even in large cities. Tenants do have you over a barrel, just a little, today...

    If these were renters, id say hell no, evict, let them move. Simply because it costs too much to financially support a non-paying renter. Its more predictable if i have an empty unit.

    However, commercial is so specialized, its tricky. But you know the industry your tenant is in, you see his/her foot traffic. Dont lower rent if you think they are lying.

    good luck

  • ceinvests10th February, 2009

    Normally the Norva market should be super stable. But right now?
    I know I am suffering good tenants for homes in the fringe markets... more costs, less overtime/jobs.
    I have an office in Denton, Md. that is sitting empty since last year. Not exactly commercial, but kinda (used to be a hair salon, then rented to Choptank Health). I have spoke to many about the lack of growth of all types of businesses... even in areas that are promoting all types of support.

    I would sit down and have a one on one meeting to listen to what and why they are asking for a deal; see if they are discounting to customers in order to keep business, etc.

    I would deal if I had a paying customer in this climate.

    Just my 2 cents.

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