{"id":1004039867,"date":"2012-03-21T12:46:33","date_gmt":"2012-03-21T20:46:33","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004037692"},"modified":"2022-12-03T19:26:49","modified_gmt":"2022-12-04T03:26:49","slug":"reduce-a-tenants-rent-in-a-triple-net-property","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/reduce-a-tenants-rent-in-a-triple-net-property\/","title":{"rendered":"Reduce a Tenant\u2019s Rent in a Triple-Net Property?"},"content":{"rendered":"<p><strong>By Randolph T. Mason, CCIM, SIOR<\/strong><br \/>\n<em>Partner, Commercial Realty Specialists<\/em><br \/>\n<a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2012\/03\/Net-Lease-Randolph-Mason.jpg\"><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004037693\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/032012-tempo-2000-apts-atlanta-150x150-50x50\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2012\/03\/032012-Tempo-2000-Apts-Atlanta-150x150-50x50.jpg\" data-orig-size=\"50,50\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;}\" data-image-title=\"032012-Tempo-2000-Apts-Atlanta-150&#215;150-50&#215;50\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2012\/03\/032012-Tempo-2000-Apts-Atlanta-150x150-50x50.jpg?w=50\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2012\/03\/Net-Lease-Randolph-Mason.jpg\" alt=\"\" title=\"Net Lease - Randolph Mason\" width=\"150\" height=\"140\" class=\"alignright size-full wp-image-1004037693\" \/><\/a><\/p>\n<p>Even having a discussion about a rent reduction is a serious undertaking. A distinct advantage to agreeing to rental reduction is that the tenant will continue to pay the triple-net building\u2019s operating expenses. Should the tenant vacate or go out of business, the building\u2019s owner still needs to pay the property taxes, insurance, building maintenance, landscaping and other miscellaneous operating expenses.<\/p>\n<p>If a rental reduction is agreed upon, ideally it will generate some cash flow to help service any debt \u2013 as the saying goes, \u201ca little of something is better than a lot of nothing.\u201d Additionally, the lease could be extended if this is in the property\u2019s best interest. If a tenant is requesting a rental reduction, it is not unreasonable for the landlord to request a personal guarantee from a creditworthy entity, should one not already exist.<\/p>\n<p>In these uncertain times, it is not uncommon for a business owner to be running their business with a fight-or-flight mentality without a comprehensive business plan in place. As a precondition to rent reduction, the landlord may want to discuss the tenant\u2019s business plan, which may even help motivate the tenant to create one if it doesn\u2019t exist, ultimately helping the tenant. The tenant will also need to provide current financials along with the restructuring plan.<\/p>\n<p>In some cases, thought, a rent reduction may not make sense \u2013 especially if it is just delaying the inevitable. In other words, the tenant may be going out of business. If a reduction is granted, it\u2019s important to remember the value of the building will decrease against the cap-rate valuation method.<\/p>\n<p>Generally, it often makes sense in a soft market for a landlord to consider a reduction in rent in order to mitigate the landlord\u2019s losses, should the building ultimately become vacant.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong>By Randolph T. Mason, CCIM, SIOR,<\/strong> <em>Partner, Commercial Realty Specialists<\/em><\/p>\n<p>In a soft market, many tenants may have problems with monthly rent. A rent reduction should be approached cautiously, but could be beneficial for both tenant and landlord. <\/p>\n","protected":false},"author":1201,"featured_media":1004037395,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1004039867","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Reduce a Tenant\u2019s Rent in a Triple-Net Property? - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/reduce-a-tenants-rent-in-a-triple-net-property\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Reduce a Tenant\u2019s Rent in a Triple-Net Property?\" \/>\n<meta property=\"og:description\" content=\"By Randolph T. Mason, CCIM, SIOR, Partner, Commercial Realty Specialists In a soft market, many tenants may have problems with monthly rent. A rent reduction should be approached cautiously, but could be beneficial for both tenant and landlord.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/reduce-a-tenants-rent-in-a-triple-net-property\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2012-03-21T20:46:33+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-04T03:26:49+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2012\/03\/Net-Lease-Randolph-Mason.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"150\" \/>\n\t<meta property=\"og:image:height\" content=\"140\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Nicholas Ziegler\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/reduce-a-tenants-rent-in-a-triple-net-property\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/reduce-a-tenants-rent-in-a-triple-net-property\/\",\"name\":\"Reduce a Tenant\u2019s Rent in a Triple-Net Property? 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