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My wife and I just bought a small commercial building 6 months ago (great timing). We have already offered rent deferment to our tenants (a restaurant, a books

My wife and I just bought a small commercial building 6 months ago (great timing). We have already offered rent deferment to our tenants (a restaurant, a bookstore and a few professional offices) with a gradual payback. We are all in this together.

sporkland 7y ago
Honestly curious, but I'm sure it will sound accusatory. They (your tenants) permanently lose the business for the months the economy is shut down. But you as a land lord expect to be made whole just over a longer timespan. How is that in it together? In it together feels like you'd lose some portion of the rent you are charging or all of it and expect some amount of relief from the government. I mostly ask because I'm not fully sure what should be fair for all parties involved. Restaurants, bookstores and offices shouldn't fail because they can survive a once in a hundred year plague. Neither should property owners who are leasing said property. But I don't understand the rules in this situation. You may be preaching about how you're in it together, but if your tenant goes under you may be screwed on your loan payments.
- bawolff 7y ago
  There is no magic solution here, all parties are going to get somewhat screwed by this. Its not like defering the rent is neccesarily in the best interest (from a purely ecconomic perspective of the landlord). If you defer rent for many months only for tenant to go under when this ends (and lets be real, many tenants are going to go under when this is all said and done), the landlord would be better off being heartless and not defering rent
  - viklove 7y ago
    Sounds like they're not in it together
  - deleted 7y ago
    [deleted]
- perlwle 7y ago
  I can share how people in China deal with this. During the high of the coronavirus outbreak, for individual or company, one could call the banks to postpone mortgages, loans or credit card payment for 1 to 3 months. Business may get longer extension if the situation worsen. That was possible in February, less so now as life turns normal gradually since March. Work resumed, shopping mall reopened etc. schools still closed though. As for rent, Business tenants negotiate with landlord for rent forgiveness, something like half month or one month rent.
oulu2006 7y ago
That's a nice gesture, but not really in it together. In it together would be rent forgiveness. The bookstore and restaurant have lost business, their customers aren't deferring payments with a gradual payback.
- HeyLaughingBoy 7y ago
  Being a landlord is his business. If the bookstore and restaurant lose business and can't pay their rent, he is losing business and potentially can't pay his mortgage on the building. Being "in it together" means he's giving them time to repay the back rent instead of evicting them if they can't pay, as he legally could. Commercial lease tenants have far fewer rights than residential ones do. It's easy to spout "rent forgiveness" but where is that money coming from?
  - deleted 7y ago
    [deleted]
  - CiscoCodex 7y ago
    I think the crux is in the wording. For me, being "in it together" means if you're struggling I'll struggle with you. The bookstore is losing business and the landlord, in the spirit of helping out, should lose business as well. Maybe OP is struggling making their own payments because they don't have the rent money. But ultimately it seems the bookstore ends up with the rough end of the deal. The landlord will recover deferred rent, but the bookstore will not get their lost business back. To clarify, I applaud OP for doing something that eases the stress of payment. But I think the wording could have been better.
    - oulu2006 7y ago
      Yes, to me being "in it together" means suffering is shared. I said it was a nice gesture, and it is, but to me in the long run (assuming the book store doesn't go out of business) you still get your pound of flesh, you just get it a bit later, that's not really suffering together.
  - 7y ago

sporkland 7y ago

Honestly curious, but I'm sure it will sound accusatory. They (your tenants) permanently lose the business for the months the economy is shut down. But you as a land lord expect to be made whole just over a longer timespan. How is that in it together? In it together feels like you'd lose some portion of the rent you are charging or all of it and expect some amount of relief from the government. I mostly ask because I'm not fully sure what should be fair for all parties involved. Restaurants, bookstores and offices shouldn't fail because they can survive a once in a hundred year plague. Neither should property owners who are leasing said property. But I don't understand the rules in this situation. You may be preaching about how you're in it together, but if your tenant goes under you may be screwed on your loan payments.

bawolff 7y ago
There is no magic solution here, all parties are going to get somewhat screwed by this. Its not like defering the rent is neccesarily in the best interest (from a purely ecconomic perspective of the landlord). If you defer rent for many months only for tenant to go under when this ends (and lets be real, many tenants are going to go under when this is all said and done), the landlord would be better off being heartless and not defering rent
- viklove 7y ago
  Sounds like they're not in it together
- deleted 7y ago
  [deleted]
perlwle 7y ago
I can share how people in China deal with this. During the high of the coronavirus outbreak, for individual or company, one could call the banks to postpone mortgages, loans or credit card payment for 1 to 3 months. Business may get longer extension if the situation worsen. That was possible in February, less so now as life turns normal gradually since March. Work resumed, shopping mall reopened etc. schools still closed though. As for rent, Business tenants negotiate with landlord for rent forgiveness, something like half month or one month rent.

oulu2006 7y ago

That's a nice gesture, but not really in it together. In it together would be rent forgiveness. The bookstore and restaurant have lost business, their customers aren't deferring payments with a gradual payback.

HeyLaughingBoy 7y ago
Being a landlord is his business. If the bookstore and restaurant lose business and can't pay their rent, he is losing business and potentially can't pay his mortgage on the building. Being "in it together" means he's giving them time to repay the back rent instead of evicting them if they can't pay, as he legally could. Commercial lease tenants have far fewer rights than residential ones do. It's easy to spout "rent forgiveness" but where is that money coming from?
- deleted 7y ago
  [deleted]
- CiscoCodex 7y ago
  I think the crux is in the wording. For me, being "in it together" means if you're struggling I'll struggle with you. The bookstore is losing business and the landlord, in the spirit of helping out, should lose business as well. Maybe OP is struggling making their own payments because they don't have the rent money. But ultimately it seems the bookstore ends up with the rough end of the deal. The landlord will recover deferred rent, but the bookstore will not get their lost business back. To clarify, I applaud OP for doing something that eases the stress of payment. But I think the wording could have been better.
  - oulu2006 7y ago
    Yes, to me being "in it together" means suffering is shared. I said it was a nice gesture, and it is, but to me in the long run (assuming the book store doesn't go out of business) you still get your pound of flesh, you just get it a bit later, that's not really suffering together.
- 7y ago