Here are a few tips we put together for you, so that you can stay aware of your options to best navigate your business during this time.
Review your lease again to see if your rent is simply base rent or it includes pass-through expenses. How much are these expenses and are they set to increase?
When does your lease end? What renewal options are available?
What constitutes a default of the lease? What tools are available to the landlord in such a case (penalties, eviction, interest, etc.)?
Is there a “force majeure” clause? What happens if there isn’t?
Does your landlord hold a security deposit? If so, how much is it?
Review operating covenants and sublet/transfer agreements.
Speak to your insurance agent to see what coverages are maintained by each party. Know your options to file a claim under existing insurance.
Explore governmental relief programs, which may be popping up quickly, for tax relief, access to loans, relaxed restrictions/regulations, etc.
Based on our current financial position, understand what concessions you would need from your landlord in both best- and worst-case scenarios related to COVID-19. We always try to promote the value of win-win relationships between tenant and landlord. This is where constant communication is more important than ever. Common solutions can be found.
Contact your landlord and specifically outline how your business is being impacted by the COVID-19 pandemic. Arrange a meeting and be prepared with data to have an open conversation regarding your recorded losses to identify a solution or combination of solutions.
Every business and lease are unique and face specific challenges that must be taken into consideration before making any decision. We are here to provide you with the proper advice and legal assistance to deal with your specific challenges before they get out of hand. Call us today at 514-882-2920 to find out how we can help.