Across the country governors are implementing protections for commercial tenants. Whether it is rent for office space or monthly gym or field space, you have many options to lower or avoid rent. In addition, we have spoken to numerous sports and fitness organizations that have negotiated substantial rent reductions. We know how important it is to lower costs as much you can for the foreseeable future. We hope these tips can help you reduce your rent which is consistently the second biggest cost for sports, fitness, and activity businesses after payroll.
1- Monitor Announcements from Your Governor.
Do a simple Google search to research new announcements from your state governor. Some states have passed rules deferring rent payments, allowing tenants to use security deposits towards rent, or even mandating that rent be reduced. The situation is fluid and new initiatives may be announced. Make sure to monitor these on an ongoing basis so you are fully aware of your rights.
2- Negotiate with Your Landlord
Regardless of the rules in your state you can negotiate with your landlord. Many landlords have lower costs as a result of the crisis and they also are able to take advantage of state and federal programs. With their costs reduced and stimulus going to their business it is not unreasonable for you to ask for rent reductions and deferrals.
Tips for Asking for a Rent Reduction
- Carefully Review Your Lease and all of your agreements with your landlord.
- Be Candid and Transparent about the difficulties your organization is facing. Most landlords will be entrepreneurs themselves and empathetic about what you are going through.
- Call First before sending an email with a specific rent reduction offer, call your landlord and explain the situation. Feel out their attitude on reductions and let them know that you will need concessions and you're assessing how much. Use this as an opportunity to gather insights and information.
- Leave Room for Negotiation. Offer an amount that you feel you can reasonably pay and expect for your landlord to come back somewhere in the middle. Give yourself a sizable cushion in your initial request.
- Be Respectful and Empathetic. Your landlord is negatively affected by Covid just like everyone else. Put yourself in their shoes and try to find a reasonable solution that will work for all parties. If your landlord becomes unreasonable you can always be more aggressive in subsequent interactions. Initially its good to give them an opportunity to be generous while keeping things on good terms.
What Else Can I Do to Lower My Monthly Costs During Covid ?
Checkout our post on additional cost cutting strategies for sports, fitness, and activity businesses here. You can also join the waitlist for Playbooks $1 Million discount and cashback and grant program here. We can provide your business with up to $25,000 of cash over the next 12 months. As always were monitoring chat and the phones and were always available to help any sports, fitness, or activity business in any way we can . Whether you have questions or want to share your experience you can chat with us or call us anytime.