Commercial Leasing

About to get evicted and need some HELP!

essomj — Wed, 11 Nov 2009 20:46:57 GMT

I bought my uncles smoke shop a year ago. I changed the name and all the licenses of the business to my name. My shop is located in a plaza with other small businesses. Here is my problem. One of the Tenanants has a liquor store and has not paid his rent. He is trying to negotiate with the landlord to get his rent reduced. The liquor store has exclusive rights on selling liquor and tobacco. I also cary tobacco. When my uncle first opened up what is now my smoke shop, he needed the liquor store to sign a waiver releasing the rights for him to also sell tobacco. I am trying to get a new lease in my new businesses name. The landlord is telling me that the liquor store wants to get there rent reduced and if he doesnt agree that he will not release the rights for me to continue to sell tobacco. The landlord said that the liquor store is asking for a rediculous reduction in his rent and he will not honer his request. The landlord told me that he wants me to convince the liquor store since the owner and I are really good friends to sign the waiver to release tobacco rights to my shop. The landlord said if he does not agree that I must stop selling my tobacco products. He even said that he doesnt care if my shop gets shut down. He is not willing to get sued over one business. Here's something else that is coming into play. The liquor store is owner is subleasing the store from his uncle who owns a pizza shop in the same plaza. Now the uncle is saying he wants to be removed from the lease and wants me to pay for his new sign that is being installed. just to fill you in: Our shopping center is going through a remodel and all of the businesses signs are being redone. I approached the uncle and asked him why he told the landlord that he wanted me to pay for his sign. He said he never said that. He said he told the landlord that he wants his name removed from the liquor stores lease and wants his sign paid for. He didnt say he wanted me to pay for his sign. So now I got the landlord trying to have me pay for another businesses sign. The liquor store is saying that he is using my shop as means of negotians to lower his rent. I somehow am stuck in the middle of this whole situation and am fitghting to get my lease signed off and continue to do business. This is all I have. This is my livelyhood that is being played with. I am stuck and if there is anyone out there that can help me and my little shop I would be so thankful for to them.

Commercial Lease

UNIONONE — Fri, 06 Nov 2009 18:46:59 GMT

I signed a Lease with a landlord for our school(OHIO) and since then she has did not have the building under code as she said then she has been talking with my parents and students about our business dealings!

She told ta parent about a check that wasnt honored but we replaced it quickly with a cashiers check. So her telling that made Parents take their kids out of the school which made our income drop... which made us late for the next months rent..... then she went to a reporter about us being late with the next rent in which made parents remove more students which has us closing our school down.. Of course Im not going to want to pay her anything.. so what do I do

Personal Guarantee Expiring, What are my options?

texasmerchant — Wed, 04 Nov 2009 17:03:24 GMT

I am a business owner in Texas and signed a five year commercial lease under my single member LLC. I negotiated a 3 year personal guarantee (instead of all five years) into the lease and I have been open just over two years and am eleven months away from hitting the three year mark. I have paid all my rent on time and have done everything else required for the personal guarantee to end after three years. My landlord has been excessive in their triple net increases and I am now paying double the original rate. My business is breaking even, but is not returning the profit I had hoped. I have tried selling, but have not had any success doing so and would like to pursue other business opportunities and would welcome feedback on my option... personal guarantee expires. I have approximately $50,000 worth of equipment in my business that I am leasing to buy and still have three years remaining on the lease that I will pay off. Here are my questions:

1. If I decide to close my business after my personal guarantee expires, but still have approximately two years remaining on my lease, what (realistically) are my personal risks/obligations to my landlord for the balance of the lease term?

2. If I decide to close my business after 3 years, I assume I should try and sell or remove my equipment first and also dissolve my LLC. Please advise on any suggestions regarding procedures or steps to take and how one dissolves an LLC.

3. What other recommendations would you suggest to limit my personal financial exposure?

4. Any other advice or things to be aware of?

Thanks in advance for your learned feedback, it is very much appreciated!

Getting Out of my lease

chelp — Sun, 01 Nov 2009 17:00:19 GMT

I started a business in 2007 and signed a five year lease on a new building with a two year personal guarante... With the recession and an increase in rent due to CAM (33% increase), the business is faltering. I had to return to full-time employment just to help pay some of the rent and the fact that my husband was laid off. He is now working again but at less pay. Between working full-time, employee issues, and the fact that it is not making money, we are wanting this financial, emotional, time consuming drain to end. We have tried selling but it is not. This time of year through April is always profitable, but come spring and summer we lose all the profit and end up putting anywhere from 5-10,000 of our own money to keep it afloat. So come April we will have put in approximately 34 months at this location. I wrote a letter to the landlord stating that if rent/ cam was not reduced we would not keep going....he just stated that everyone has it tough and that I just need to hang in there. I am in debt of back payments of CAM/Rent to him of approximate 28,000 right now. At the time of my 2 year guarantee agreement, I was behind in CAM of 21,000. I basically am paying him any profit after expense. Three times there was no profit so I paid the 2500 (half the required rent payment) from our personal funds. So far he has not demanded the back payments. But we are getting further in debt owning him as we continue to be in business each month. So I have a few questions:

1) Since my two year personal guarantee was up, and I still owed him in the personal guarantee portion 21,000 in back Cam/Rent. Should I continue to run the business until April as it will allow me to make some more rent payments to him without taking money from me personally due to the profitable season, and possible lessen this amount owed to him. Or should I close the doors as the longer I am in business the more the back rent increases, as I never make enough to completely pay full rent. Does the court look at the total amount paid to him as being my portion of the personal guarantee. My husband thinks that if we stay in business through April and then continue to pay him as much rent as possible, that this will decrease the amount we personally owe him as the court will look at total payments. My fear is that by staying in business we are just adding to the debt we will be personally be responsible for.

2) If he then tries to sue us for the remaining lease, we are incorporated and therefore, we would file bankruptcy on the business. Do we also have to file personally in order to file business bankruptcy?

Any suggestions, advice is welcome!

Breaking a commercial lease

Beautygirl — Wed, 15 Apr 2009 18:20:16 GMT

I have 3 more years on my commercial lease and my business has tanked in the recession. I have asked my landlords for rent relief, if I can change around my business, bring in more services, move into a smaller empty space in the mall and some other options and they have denied each. I need to leave as I have no more money to float the business. My company is incorporated, but both my husband and I signed a personal guarantee to lease. If my corporation goes bankrupt, I am still on the hook. If I go bankrupt, my husband is still on the hook. Our only asset is our home, if we change the title to my mothers name, will that protect our home?

What other options do we have? I have tried to sell the business and sublease the space to no avail. Once I leave, I understand they will sue. I have asked them to settle with me, but no answer yet (one week later).

help.

IS IT A ILLAGAL IF HE LEASE IT OUT LIKE THAT???? PLEASE HELP

lisale — Wed, 23 Sep 2009 19:46:02 GMT

I'm from New Orlean Louisiana It a problem i have with the place i rent for my spa. and i want to ask for your option. My leasing agreement that he rent a space for me down stair and a 2 treatment room for me up stair right in the middle of the building when he rent it out to me on the second floor also was some tenant what was living in the same floor he say that where will not do bother us with ours business. But day and day go by after one person move in and out from both side of the 2 floor. Some time there even move in during our business hours. We are doing massage and facial up stair and someday you can smell people cooking talking and even play loud music washing there clothes and leaving that around. And when my employee do there massage sometime customer ask what is all that noise. Because of all the different people that he rent out it just to much people coming in and out and i don't want my customer to see it because that are some weird guy coming in and out with the girl and the girl was wear short that up to her butt and my customer have to see that. i think that it is very interfere with our business. And another thing is that the building i guess because it old maybe but the power alway get switch off during the middle of the service and the Power Fuel Switch BOx is locate in one of the side the he is renting out to other tenant and we can't get throw it. When we call him it take him for more than half an hour to come down and my customer can wait something my employee is right in the middle of giving the hot stone massage and the power when off and we can't turn it off to continue to do the service and we have to ask if the client would like to service there service to something else it is very bad.I have request him to give us our own fuel box but i guess he doesn't want to put out any money to do it. Before i was think to rent the other side of the 2 floor too to open up a refreshment drink down stair and do salon up there so that he will be less people walking in and out of the hall way but still the other side still going to have people living in it. and we still cant get assess to it. But any where i think that he can't have someone doing there business and have tenant living in the same area. I dont think the department of safety and planning is aprove for this specally when we can get assess to anything in an emergancy the Fuel Box the HVAC unit we can't getto anything becase it look up in someone else space it take him a long time to come out. Like one time the AC broke down and i call the AC guy cme out to take a look and the guy was there for an hour before he come out and the guy was really mad that the frst time and the second time 3 week after the ac won't run for no reason when we open up the shop i have to call the ac guy come back out and he here waiting for 30 min and he still didn't come out i call and told him that he need to find someone out here and fit it because im guy left and if he dont and i have to close my shop up i was going to bill him it take him from 10-4pm to get someone out and it was a hot hot day some customer coming in and walking out because it was to hot. I want to know if i can withdraw the leasing that i have with him. Becuase it so many problem with the building and i can't go my business. Please help me what are my option. thank you very much. SORRY I WRITE TO MUCH. My question is it legal for him to have my business running while there are tenant living in the same area? why the city hall approve it

3 day pay rent or quit notice

bleu2th — Thu, 17 Sep 2009 23:21:59 GMT

I am not delinquent on my office rent but have slow cash flow this month requiring my holding some payments for release. My rent is 7 days past due. My bookeeper called the office manager and asked to mail the rent check in one week, that would make the rent about 13 days past due. She was told that was not acceptible and we will be served with a 3 day pay rent or quit notice and will be asked to move out.

Am I missing something here, is this legal. I thought you really have to be delilnquent? We will have the rent paid in full by months end. I assume this is posturing but as a tenant with a good history of paying I am pretty pissed and before my "put your notice in an appropriate orafice" response I would like to get the legal side.

Interestingly my lease is a 2 year with a 3 year option and this month is my 2 year anniversary, so unless they are trying to ask me leave (too many vacancies here, doubt that) I would think this is not a good move on the landlords part when I am at my option and could move out at my choice.

Please let me know the time and requirements of a 3 day notice as I think this is a false statement on the part of the manager.

thanks in advance

Commercial Lease held by ex business owner

Arroyo Grande — Sat, 29 Aug 2009 06:08:23 GMT

Kind of a tough question here... my employer sold his small machine shop business to larger machining company last year and stayed on in their employ until he retired in February of this year. Since then, he has kept up the lease with the landlord by turning over the money sent in by the new company owners ( deposits mailed check into his old business account - then writes check for lease amount). The new company doesn't really want to take on a new lease at this time due to a higher lease rates and higher deposit amounts. All of this is fine EXCEPT THAT the newly retired boss has consistently entered business premises not only during our regular business hours but on weekends as well without permission. He has his personal 5th wheel trailer plugged in constantly and occassionally uses the office computer as well. There has to be some personal safety, liability, or security issues that need to be addressed but I don't believe we can ask the property landlord to even change the deadbolts and locks because the old boss still holds the lease ( and his PREVIOUS little slice of Heaven...). What are some options that we can look into without having to force some kind of legal litigation ?? Any ideas how to approach this sticky little mess???

Update and Assistance Request- Assignment of Commercial Leas

ritajwilson — Mon, 17 Aug 2009 19:53:34 GMT

First- Thank you all for your responses.

Here is the down-low:

1- I purchased an existing franchise.

2- I executed an Asset Purchase agreement with the seller.

3- Asset Purchase indicates "Buyer shall assume no liabilities or debt of seller except for the Commercial Lease."

4- Landlord never executed a new lease or an Assignment of Lease..The original lease is still between the LLC that originally signed the lease ( the seller)

5- I have now closed the business due to the economy.

6-Because an Assignment was never signed, I feel I am not contractualy resp... for the lease. The Landlord says the Asset Purchase Agreement serves as the Assignment Agreement (even though it is between the seller and me, not the Landlord and me).

7- The original owner/LLC that I purchased the franchise location from has declared banruptcy with the state and has no assets.

My questions:

-It was agreed by my peers on here that it would be difficult for them to come after me since an agreement was never signed and difficult to come after the seller since they are bankrupt.

I recevied a letter from the LL attorney stating that I was responsible due to the landlord being a third party benificiary to the contract between me and the seller and the creation of a privity of estate (since we performed under the lease.) Do you think this holds any water???

Thanks,

Rita

Lease Assignment- Who is responsible

ritajwilson — Thu, 23 Jul 2009 02:16:14 GMT

First- Thank you all for your responses.

Here is the down-low:

1- I purchased an existing franchise.

2- I executed an Asset Purchase agreement with the seller.

3- Asset Purchase indicates "Buyer shall assume no liabilities or debt of seller except for the Commercial Lease."

4- Landlord never executed a new lease or an Assignment of Lease..The original lease is still between the LLC that originally signed the lease ( the seller)

5- I have now closed the business due to the economy.

7- The original owner/LLC that I purchased the franchise location from has declared banruptcy with the state and has no assets.

My questions:

-Since I never signed a lease with the LL or an Assignment Agreement, can they hold me responsible?

-Does the Asset Purchase Agreement hold grounds for an Assignment with the Landlord?

-What is the likliehood that the desolved (bankrupt) LLC (previous owner) will have to pay or would counter sue?

-If they cannot provide back-up of an agreed assignment, am I covered by the Fair Debt Act?

Thanks,

Rita

Fixtures vs "real property"

jumping bean — Wed, 17 Jun 2009 17:09:34 GMT

What can be removed when the lease states "fixtures" according to TN state law become part of the leased premises. Specialty items I purchased for my business are now being claimed by landlord as his. I paid for entire build out and bought custom doors, lighting, etc. Landlord claims he now owns them. HELP?!

Can't risk law suit or afford much for an attorney and need to sell all of my property to pay bills. Need to remove and sell all legally allowed to pay creditors.

Does this void our lease?

bez09 — Wed, 10 Jun 2009 19:17:09 GMT

California

We currently trying to run a business, and share the first floor with with other businesses. Currently are having trouble getting a business license, because one of the tenants who are the same floor has an illegal floor plan, and does not have the proper permits. They proceeded with construction to their area, without any permits.

We have been paid for the last two months, and can't get any foot traffic, because we are unable allow our customers to come in without a license.

Does this some how void the lease? Does an improper floor plan, and not being able to run our business void the lease?

Who Measures Square Feet?

lesle — Thu, 28 May 2009 01:48:10 GMT

Who Measures Square Feet? Some years ago I leased a small unfinished warehouse space. The space by eyeball was adequate for my needs. The lease did not mention square footage; it also did not mention rent increases. Rent increases are announced by letter. The first few rent increases were at first an even dollar amount and then later a percentage increase of the previous rent. However, beginning in 2005, rent has been increased annually based on square feet. Recently I came to realize that the space is about 8% smaller than stated. (Yes, I've taken demised walls into consideration.) I've read all of this board; I realize I'm going to need a lawyer. I want to be able to take to him or her measurements that will stand up in court if necessary. Who does this kind of measuring? Any other thoughts? Thanks.

Breaking comm lease, but..........

smalltimebiz — Fri, 15 May 2009 06:26:28 GMT

Is my commercial lease agreement valid and legal if, spouse signed and my business name is on the lessee line of lease. I'm no where on the lease or didnt sign it and husband is not on my business license. Who's liable? Also, the lease is in residential format instead of commercial. On the top of lease states Residential Lease. Then for my property location theres a wrong building number that is not what im occupying and no street address,city, state, or zip code filled in the blank. I know I'm in breach for breaking, but i can't afford buyout option lump sum, i offered payments with a buyout paid in full by 8/09. have email says no payments want full amount to terminate lease. I didnt pay this months rent and gave keys back. Have appt to talk to attorney in a few days. What should I expect to happen. My main question is this lease legal if not properly completed and if so, why cant payments be made if im willing to do so. Thanks for any advice.

Faltering business, lease strategies

mfg72 — Mon, 09 Jul 2007 19:59:42 GMT

I've got a franchise business in a commercial strip mall. Gradually, other businesses in the center & nearby area have been moving out. This is hurting my sales so that my cashflow is now negative. I have two years left on my lease.

I am trying to sell the business, and have some interested buyers. I will be selling at a big loss, but at least will hopefully get me off of the lease, which has a personal guarantee of course.

I am current on my rent now, but have been funding it with income from other sources to prop the business up. But from the landlord's point of view, I'm paying the bills at the moment. I want to ask the landlord for some rent concessions, but I am worried that this will then make him not want to transfer the lease to any new buyer I might find.

Since other stores in the center have gone away, I don't know if he has accepted lease buyouts from them, or what. I am worried that this will make him even more tentative and want to hang on to me. Should I send the red flag by asking for concessions or hold tight and hope I can find a buyer to take over?

Breaking a mall lease

Skip Solo — Tue, 14 Apr 2009 14:48:54 GMT

I have had a business in a small indoor mall since 1994. It was very successful. We renewed an initial 10 year lease in 2004 for another 10 years, with a cotenancy clause stating that if Target moved out of the mall (they were right by our store), then we could get out of our lease. We thought the magic time period was 1 year, but they slipped in 1 year plus another 120 days, which we didnt notice when we signed the lease. Our bad. Anyway, our sales are down about 75% from before Target moved out. We will be lucky to break even over the next year. Other business in the same general location as us are also struggling, and the mall is unwilling to help us out. They will let us all move, but will increase our rent by half again. I cant believe malls do business like this. This mall is losing lots of stores because of their apathetic attitude towards its tenants. They promised signages to get people to see what businesses were up in our corridore, and never delivered, among other things. Anyhow, is there any way to get out of our lease and not take a beating? Thanks, Skip Solo

leasing an inline spot in an indoor mall

Skip Solo — Tue, 14 Apr 2009 14:27:48 GMT

I wrote about a month ago, a question about how to negotiate a fair rent and CAM charges in an indoor mall. Someone wrote back giving me a great way to figure out how to equate a figure that will help me offer a doable rent. I cant access the answer, nor my question. Help please! skipsolo@yahoo.com

Mitigation- Lease- Michigan

dmomet12 — Thu, 25 Dec 2008 18:18:41 GMT

I was wondering if you could answer a few things about a commerical lease for me:

1) Business defaults- I was told in Michigan that the LL has to try and re-rent asap and mitigate the damages. Not sure where this is located in writing. Is this correct? In addition the current lease has 24 months left on it. If some new LLC re-rents this space is it most likley that they will sign and negoiate a new lease, terms etc.?
The LL can't make the new buyer assume the old lease can he? Otherwize he would turn down most every potential renter.

Based on the ecomomic climate its possible the new lease rent may be lower. What can the LL go after regaring the defaulting tennet's?

Obviously - x months of rent until re-rented. What about the difference between new lease rent and old? Does that come into play ? My friend that is a LL said he and some other LL's in the area are reducing rent in some case's for curent tennants rather then have zero rent coming in.
Thanks for clearing this up.

Mitigatiing a lease

dmomet12 — Mon, 13 Apr 2009 00:20:50 GMT

Happy Easter Folks.

I recently met with 2 local attorneys on ths above subject and both told me the same thing which I guess is good but things I had not heard before. I will try to make it short as possible. Current lease expires 04/11. If there is a default on the lease. ( MIchigan). The LL has the obligation to mitigate. I was told that the LL can't sue for any $ damages until the lease term actually expires so that the LL, judge etc can quantify the real actural monetary damages.. In otherwords in this case the LL can't sue until 04/11.?

Curious if this is correct. It makes sense as the damages are not really quantied until the Lease ends or its re-rented.Your help is appreciated.

Help with lease buyout

guyintrouble — Fri, 10 Apr 2009 02:52:14 GMT

I finally setteled with my landlord to buyout of my lease. I was sent the buyout forms but there is a section that I need translated please.

the following shall survive the termination of the leases 1) lessor rights to indemnification from lessee under the terms of the lease for all events occuring prior to effective date 2) lessee obligation to indemnify lessor under the terms of the lease for events and occurrences occurring prior to the effective date 3) lessors right to make claims againts lessee liability ins. under the lease for claims and or occurrences arising on or prior to effective date 4)lessors right to make claims against any third party 5) lessors right to make claims for any hazardous substance conditions as defined in the leaseagainst lessee and or and third party are legally responsible 6) the obligation of lessee to place the subject premises in the condition required under the lease 7) lessors right to make claims against lessee for the performance of any and all the lessee obligations and responsibilities under the lease arising prior to and accruing through the effective date 8) the rights and obligations created or preserved by lessor and lesse in this agreement

Sorry its so long but I am singing papers tomorrow and im confused to what the are keeping responisble for.

I really appriciate anyones response to this as soon as possible thank you very much

Mike

5 years remaining and I need out!

guyintrouble — Fri, 30 Jan 2009 22:59:59 GMT

I signed a 8 year lease agreement on a car dealership back in 2006. I came into the location and spent well over $200,000 in improvements with no help from my landlord. My lease amount is $18,000 and I have been losing money for the past year due to the drastic turn in the economy. Banks are no longer lending money to my customers, therefore, I can no longer operate my biz like it should be. I have 5 years remaining which total out to $1,000,000. I have taken numerous loans to cover my monthly expenses based on the fact that there will be a turn in the financial sector, that has yet to happened. So, I set up a meeting with my landlord in a hope to buy out of the lease, I started my offer at $50,000 and got a rebuttal of $300,000 which is impossible for me to do, so I doubled it to $100,000 and they stood firm. I cannot afford to pay more then my offer. I don't know what to do anymore. I am pleading for some help.

Thanks

How soon can you pack up on expiring lease

scotty21 — Thu, 26 Feb 2009 16:28:32 GMT

I have a lease that I have wanted to buy out of for several years. The landlord would not allow it and would not allow me to go dark and just pay him the rent. He wanted me to stay open as it says in the lease and since I have other locations I did that. I am now down to the last 60 days of the lease. I of course lose money at this location every day. I am just trying to calculate out my closing date and then the time to move out of the store. If I close the store for good with 30 days left in the lease I would assume that I would not be blighting the center. I assume that I am allowed a period to clear my stuff out and get it to a clean condition and 30 days seems like a good period. I have followed through with this lease now to the end and just need some advice on the closing date.

Thank You,
Scottydog

Problems getting lease assignment handled

kirkpat — Mon, 02 Mar 2009 19:32:39 GMT

I bought and sold back a franchise last year. The franchisor verbally agreed to take assignment of the remaining four years on the five year lease. They have taken possession of the premises. They are dragging their feet on the assignment, and are $7k behind on the rent. I have no way of paying the rent, or even of doing a buy out. The landlord has been patient, but has now filed a default on me, giving me five days to come up with the back rent. What can I do? The franchisor keeps putting me off. I took a major beating on the buyback, but was just glad to have them taking the lease - which they have yet to do. I incurred massive debt on this, and am paying that back. I am not sure if I can retain a lawyer against the franchisor or what I should do.