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Business leasing is usually longer-term (often 10 years) and any rent increases are negotiated. The fun starts when the lease is up for renewal: - Landlords ca
by vishaldpatel 15y ago
Business leasing is usually longer-term (often 10 years) and any rent increases are negotiated. The fun starts when the lease is up for renewal:
- Landlords can refuse to renew it. I know of cases where the landlord changes and the new landlord decides not to continue the lease. When the business owners leave, the landlord restarts the same business in that location - hires his cousins to run shop. Often the businesses, despite being profitable (a lot of small businesses are just ramen-profitable) can not afford to move out so they leave everything behind.
- Landlord wants a lot more rent to reflect market conditions. This increases fixed costs, which make the business harder to run, and much more unattractive to potential buyers.
Most landlords want the businesses who rent from them to succeed and try to be reasonable with their demands because they prefer to have a stable cash-flow from their investments.