Whether you’re on the landlord or tenant side of a commercial lease agreement, these are stressful times. With the future of the pandemic still uncertain, you may be facing foreclosure, considering bankruptcy, or keeping an eye out for the struggles of your tenants in these areas. Even as the rest of the world hunkers down and makes the best of things, your business needs can’t wait forever—no matter which side of the fence you’re on.
Fortunately, even if you fear the worst for your business right now, you still have options.
Here are a few of the COVID-19 leasing tips you can employ to ensure that your business will be able to maintain your commercial lease and make it through this pandemic:
Plan for the Worst
If you don’t have a business contingency plan in place, now is the time to prepare one. Consider all the possible risks that could impact your business and the space you lease, and what you could do in each scenario. While some of this may feel uncomfortable, solving those problems ahead of time will give you peace of mind should the worst occur. This document will help you maintain business continuity, as well as aid with risk management, and enable you to recover quickly no matter what happens—even if that means you lose your place of business.
Work With Your Tenants/Landlords
Communication is key right now. If you’re a tenant struggling to make rent or are suffering other unprecedented difficulties due to COVID-19, it’s essential to reach out and begin a conversation with your landlord. Many property owners will be willing to work with you during this time, and you may be able to negotiate partial payments in order to keep your space. This is beneficial for landlords as well since it avoids any scenario where you lose an income stream entirely.
Guard Your Cash-On-Hand
Between PPP loans, the CARES Act, EIDL loans, and other financial assistance programs designed for small and mid-market businesses, you may have been able to secure some cash to keep your business afloat. Hold onto this cash as long as possible! Your biggest expenses will likely be rent, payroll, and any equipment leases you may have, so plan accordingly. Even if you can pay these bills for the next few months, see if you can negotiate a forbearance plan or reduced payments anyway—it’s better to have it and not need it than to run out of cash when you need it most.
Prepare Wisely For Re-Opening
When it comes time for your office to reopen, don’t rush the process. First, establish a clear plan for returning to the office, with complete safety procedures and precautions that keep your staff safe and healthy. Make sure that communication regarding illness and expectations thereof remains open—and be sure to notify all occupants of the building should an infected person enter the building. By being cautious upfront, you increase the odds of maintaining the ability to return to the office permanently.
During this difficult time, it’s important to focus on what we can control and make choices that benefit our businesses accordingly. While we may not know what will happen with COVID-19, you can take certain steps to protect yourself, your interests, and your company by owning your commercial leasing obligations. For more information regarding your business and COVID-19, check out our COVID-19 resources page.
For more information on this topic, contact our office today.