Unless you own the building in which your company operates, you have a relationship with a commercial landlord. When you originally bought or opened your business, you negotiated lease terms based on the market value at the time and what you projected the market would support over the following three, five or ten years. After operating for a while, it’s common to find that your projections were inaccurate. When market conditions change, competition increases, costs go up, or when a commercial space no longer fits the needs of a business, the lease becomes an obstacle to the business’ success and must be renegotiated.
Landlords have an incentive to maximize the value of their property, and frequently that means a resistance to negotiate. Landlords fear that if they lower rents for one tenant, they will need to do so for all tenants, and that will ultimately affect the market value of the building. However, when facing a potential vacancy, or when the current rent is no longer in line with market rates, an adjustment is appropriate. Landlords understand that long-standing vacancies are not good for their business and therefore if the context is presented transparently and appropriately, they will enter into arrangements that re-align with the current market conditions and the business tenant’s ability to pay.
Second Wind is experienced in interfacing with landlords from large property management companies to single owner facilities. We assist clients in negotiations with their landlords that result in renegotiation of rent price, extended terms, assignments and early exits from leases. At Second Wind, we understand the incentives of landlords and therefore are able to identify strategies and agreements that create value for the landlord as well as the business tenant.