3 ms·
Yeah like is it even really downside? Tenant defaults on their lease? OK, kick them out and get someone else in. What's the big deal?
by tehwebguy 7y ago
Yeah like is it even really downside?
Tenant defaults on their lease? OK, kick them out and get someone else in. What's the big deal?
- sverhagen 7y agoIf they've discounted upfront there going down overall...?
- rbg246 7y agoWell, you have forgone rent you could have collected from a different tenant and reduced the quality of the tenant you have accepted. So for an investor who looks at your rent roll, they will see that you have an increased rent arrears and they will value your asset at a reduced rate. And as the sibling comment has mentioned, if you discount up front you haven't received any money. Or worse still you provide a rent incentive in the case of a capex fitout and are now left with an office fit out a future tenant may or may not want but you have spent significant amounts of money on.