SBO Tips for Negotiating a Commercial Lease During COVID-19 – Dana Delman Discusses Strategies with Workest
SBO Tips for Negotiating a Commercial Lease During COVID-19 – Dana Delman Discusses Strategies with Workest
Small business owners nationwide are struggling to pay their commercial real estate leases, while landlords have their own financial obligations – like taxes, maintenance costs and mortgages – leaving many tenant-landlord relationships at an impasse. Partner Dana Delman spoke with Workest to offer options for landlords and tenants to work together to balance losses caused by the coronavirus.
Some options for modifying a lease
There are many. You’ll want to consult a commercial real estate lawyer, but the following options will help you begin to understand some of the possibilities. “Remember that the options are vast, and creative solutions are often the best,” commented Dana.
Provide financial information
Offer to provide financial statements, if you’re comfortable with it. “Landlords don’t know who can and cannot pay, because tenants are not required to share financial statements,” Dana said. They may be swayed by seeing the evidence of your current financial situation before entering into short or long-term lease amendment negotiations.
Consider other options
Dana recommends speaking to a bankruptcy attorney before approaching your landlord. “Don’t resign to consulting with a bankruptcy lawyer as a last resort. It should be one of the things you do as you gather information before approaching your landlord,” she said. A reorg bankruptcy like Chapter 11 may help save the business and the lease.
Questions about negotiating a commercial lease? Contact Delman Vukmanovic LLP at LA 213.943.1340 / OC 949.852.3590 or info@DelVukLaw.com.
