Are you paying too much in rent?
Have you tried negotiating your rent with the landlord but had no luck?
If so, read this article on what you can do and your chances of success.
The landlord probably doesn’t want to lose you as a tenant. If you signed your lease more than a couple years ago, then you are probably paying over market value for your space. If the landlord loses you as a tenant, they realize that it may be difficult to replace you.
You approach the landlord using plain common business sense. You explain (in writing) that the business can barely continue without the landlord’s help. Your package should include past years’ financial statements, a current financial statement, a personal financial statement or balance sheet, a specific proposal, and a mini business plan. You approach the landlord very tactfully, explain your case, and leave them the documents to take it into consideration. If they come back with a no, you come back with more information and a new proposal. You do not take a no until you have exhausted all your options.
This varies wildly. It just depends on how the numbers work out and also depends on the landlord’s financial position and how much they can afford to reduce it. I have seen reductions from 10-50%. The bottom line is that, it is a negotiation between you and the landlord, and the numbers must make sense.
A deferral means you must pay back the reduction (like a loan). An abatement means that you do not have to pay the reduction back. Most of the time, I see landlords proposing a deferral. I explain to them that the scenario sounds great in theory, but will only be causing problems later on. Later on when we expect the business to be profitable, the tenant will then begin paying back the money and will again be in a low to negative cash flow situation.
Yes, don’t get mad, and shoot and kill the landlord. This is a possible and albeit a very innovative workaround but could have some minor repercussions (life in prison, death sentence, retaliation by family members, etc.). Use this as an absolute last resort and have escape plans, contingency plans, a getaway car, and plenty of bullets. Jokes aside, this has already happened a few times this year, once here in Los Angeles where I am based. It is a very sad situation and shows how much stress business owners can be under. Stay cool and calm, and base your negotiations on facts.
This depends on the landlord. If they are a big, national, publicly traded company with layers of management, then you can expect the process to take one to three months. If it is a small, local individual landlord, then you may be able to work out a solution in a day.
The landlord will likely make the reduction for less than a year, probably about six months. At the end of the period, you should simply approach the landlord again and ask for an extension. Because the economic situation is difficult to predict, it is unlikely the landlord will commit to an extended period.