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Rent Reduction Variables   

More times than tenants want to admit, they open a business and it does not generate the sales volume they projected. Frequently it is because competition was too intense or they selected a poor location, or the products or services they are selling are not desired by the demographic profile of customers that surround the store. If you have given your business a reasonable length of time to be successful and you are unable to pay your bills, you may want to approach your Landlord with a rent reduction request. If your Landlord has few or no vacancies in his shopping center, he may be receptive to negotiating an early lease termination.  By doing this the Landlord could charge the current market rent which may exceed what you are currently obligated to pay and a new tenant would pay more.  But, if your Landlord has a lot of vacancies, he probably doesn’t want you to leave and may be much more flexible than you think to help you remain in the center. 

Having a prepared business plan, a recap of your sales history and expenses to date will help get your Landlord to understand your business situation.  

The variables below contribute to the following reasons:

Why the Tenant is doing poorly.

OR

An action the Tenant or Landlord may consider taking when the Tenant is doing poorly.

OR

A variable that will be considered prior to a rent reduction being granted.

The following list should be self-explanatory but if you have a question please email retailcriteria.com
 

bullet Current and past sales trend
bullet Sales reporting lease required
bullet Length of term remaining on lease
bullet Cotenancy protection in lease
bullet Number of vacancies in center
bullet Sales performance clause in lease
bullet Current state of center (viable)
bullet Exclusive violations
bullet Profit and loss statements available
bullet Entity who signed lease
bullet Assets of entity who signed lease
bullet Rent abatement
bullet Rent deferment
bullet Risk of Landlord default
bullet Stop paying rent
   
 

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