How to avoid a tenant vs landlord punch up

Forget supply and demand, in a crisis it’s all about partnership. Commercial landlords and tenants holding a hard line over lease terms could find themselves going to the wall in the current market.

There’s a real risk we could end up like the 90s when tenants struggling with high overheads walked, leading to record high vacancy levels and tough times for landlords who turned to offering huge incentives to attract tenants.

Right now, retailers as well as industrial and commercial tenants are obviously feeling the pinch, many just breaking even at best. And it certainly doesn’t help when landlords treat businesses such as retail as “tenant units” taking absolutely no interest in the nature of their business.

Just this week I have again been involved in a verbal punch up in a lease renewal negotiation where the landlord was taking a hard line. Talk about cutting off your nose to spite your face!

Solutions lie in viewing the relationship between tenant and landlord as a partnership. Both parties are impacted by the current market conditions.

There is plenty of room for landlords not to take a hard line on the terms and conditions in lease agreements. Sure bottom lines must be met, and it would be commercially naïve to think otherwise. But it will be those landlords that build partnerships that will keep their tenants.

Tenants and landlords alike are in the same boat when it comes to an uncertain future. No one can accurately predict supply and demand right now. Just a year ago, the market was roaring, but to try and suggest it is either a landlord or tenants market right now is a complete waste of time.

The answer lies in negotiation, give and take, so tenants can keep afloat, and landlords can be assured of a return on their investment over the long term.

What about you? Do you have any war tales to tell of puch ups with landlords? I’m keen to know what your experience is so leave a reply below…