I am both a commercial landlord in some business ventures and I am also a commercial tenant in others. Recently I have had 2 commercial tenants who have stopped paying rent. Probably a common situation in these covid times. Cuomo has put a stop to ANY eviction proceedings. Therefore, as a landlord... our only recourse is to wait till the city opens and begin eviction proceedings for these... [more]
I am both a commercial landlord in some business ventures and I am also a commercial tenant in others. Recently I have had 2 commercial tenants who have stopped paying rent. Probably a common situation in these covid times.
Cuomo has put a stop to ANY eviction proceedings. Therefore, as a landlord... our only recourse is to wait till the city opens and begin eviction proceedings for these commercial/residential tenants.
I think it is obvious though, most residential & commercial tenants are intentionally not paying rent in hopes that the gov't will provide some kind of rent relief. Cuomo has given strong suggestion that he would do this as well.
I would even argue, paying rent during these times may demonstrate that you don't even need the rent relief, sooo...you maybe disqualifying yourself for rent relief is one is offered in the future. Are you stupid to be paying rent?
Why should anyone pay the rent? Even a landlord charging a tenant late fee's isn't allowed!
It seems, playing safe... holding the rent since many of us have contractual commitments till after it is clear no rent relief will be offered seems to be the smarter move... am I wrong?
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Response by front_porch
over 5 years ago
Posts: 5316
Member since: Mar 2008
Because I pay my office rent, my landlord (who runs a small law office) can keep one more person on his payroll (maybe not quite full-time, but certainly not a negligible amount of work.) So I don't think that paying the rent is "stupid," I think it's moral. *SMH*
ali r.
upstairs realty
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Response by 30yrs_RE_20_in_REO
over 5 years ago
Posts: 9877
Member since: Mar 2009
I absolutely hear you. I'm thinking there is a distinct possibility that Cuomo's strategy is not to offer any rent relief for as long as possible, but also let everyone know they can't be evicted, setting up a situation where he hopes those who can pay will, but also where so many don't that evicting all of them wouldn't be feasible, so at some point he can pull a Vicomte de Valmont "It's beyond my control" and offer rent relief as some percentage of what the tenant's outstanding balance is. So if you paid you're SOL.
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Response by 30yrs_RE_20_in_REO
over 5 years ago
Posts: 9877
Member since: Mar 2009
Note that I don't think this is different from how the Federal Government treats bailouts: you get rewarded for taking big/unjustified risks: if you win you get to keep the profits and if you lose they step in and eat the loss for you.
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Response by 300_mercer
over 5 years ago
Posts: 10570
Member since: Feb 2007
Ali, I am glad you are making morality agreement! I wish more interactions are governed by morality and personal responsibility rather than what you can get away with (I will refrain from mentioning some of the threads). Of course, govt policies at times govern immoral behavior as may happen in this case - if you didn't pay rent, you may get some forgiveness eventually eventually paid by tax payers. Or people campaigning for student debt be forgiven where as it wouldn't be for someone who worked as a janitor or other low paying jobs to reduce debt.
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Response by 300_mercer
over 5 years ago
Posts: 10570
Member since: Feb 2007
Agreement = Argument
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Response by Primer05
over 5 years ago
Posts: 2103
Member since: Jul 2009
I am also continuing to pay office rent, however, I can see situations where it would be impossible for commercial tenants to pay rent. Look at restaurants for example, they have little to no income coming in, what are they supposed to do? The country shutting down obviously is terrible for everyone but almost everyone is in the same boat, how can expenses get paid if there are no revenues. I hope that the 1st thing landlords do not do is march into court trying to evict small business owners and put them out of business. Perhaps they can make deals with them, pay a little more each month until they get back on their feet? We should all be helping each other right now and going forward
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Response by stache
over 5 years ago
Posts: 1298
Member since: Jun 2017
If the state steps in to offer commercial rent relief they need to offer similar tax relief for the landlords. I am anticipating a large assessment to help with my coop building taxes/expenses due to lack of commercial rent income.
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Response by 30yrs_RE_20_in_REO
over 5 years ago
Posts: 9877
Member since: Mar 2009
I heard a couple of people complaining that their Coops have raised maintenance 40% to compensate for commercial tenants not paying.
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Response by stache
over 5 years ago
Posts: 1298
Member since: Jun 2017
We're up 10% this year and that was pre corona.
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Response by superlun
over 5 years ago
Posts: 79
Member since: Jul 2009
Ali, as far as commercial leases are concerned, and I can't comment about yours, almost all of them often include a "good-guy guarantee," which basically states you personally guarantee that your commercial lease rent would be paid up to the time you return the keys. So, with that in mind, I intend to pay all of my rent........ eventually... This is just a means to an end of getting rent relief from the city. I don't advocate you stiffing your landlord, this is why I mentioned "holding the rent."
However, I have been told by some of my legal friends... What is happening is, many leases, both commercial/residential have "natural disaster" clauses which basically protect the tenant in instances of "natural disasters." It was intended to protect tenants in cases of hurricanes,tsuanmis,eathquakes, etc etc... So apparently some commercial tenants are using this clause in the case of COVID being a natural disaster, and basically giving the tenant a way out of their rent since their premise is inoperable (I can see this being a problem down the road since it is somewhat valid).
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Because I pay my office rent, my landlord (who runs a small law office) can keep one more person on his payroll (maybe not quite full-time, but certainly not a negligible amount of work.) So I don't think that paying the rent is "stupid," I think it's moral. *SMH*
ali r.
upstairs realty
I absolutely hear you. I'm thinking there is a distinct possibility that Cuomo's strategy is not to offer any rent relief for as long as possible, but also let everyone know they can't be evicted, setting up a situation where he hopes those who can pay will, but also where so many don't that evicting all of them wouldn't be feasible, so at some point he can pull a Vicomte de Valmont "It's beyond my control" and offer rent relief as some percentage of what the tenant's outstanding balance is. So if you paid you're SOL.
Note that I don't think this is different from how the Federal Government treats bailouts: you get rewarded for taking big/unjustified risks: if you win you get to keep the profits and if you lose they step in and eat the loss for you.
Ali, I am glad you are making morality agreement! I wish more interactions are governed by morality and personal responsibility rather than what you can get away with (I will refrain from mentioning some of the threads). Of course, govt policies at times govern immoral behavior as may happen in this case - if you didn't pay rent, you may get some forgiveness eventually eventually paid by tax payers. Or people campaigning for student debt be forgiven where as it wouldn't be for someone who worked as a janitor or other low paying jobs to reduce debt.
Agreement = Argument
I am also continuing to pay office rent, however, I can see situations where it would be impossible for commercial tenants to pay rent. Look at restaurants for example, they have little to no income coming in, what are they supposed to do? The country shutting down obviously is terrible for everyone but almost everyone is in the same boat, how can expenses get paid if there are no revenues. I hope that the 1st thing landlords do not do is march into court trying to evict small business owners and put them out of business. Perhaps they can make deals with them, pay a little more each month until they get back on their feet? We should all be helping each other right now and going forward
If the state steps in to offer commercial rent relief they need to offer similar tax relief for the landlords. I am anticipating a large assessment to help with my coop building taxes/expenses due to lack of commercial rent income.
I heard a couple of people complaining that their Coops have raised maintenance 40% to compensate for commercial tenants not paying.
We're up 10% this year and that was pre corona.
Ali, as far as commercial leases are concerned, and I can't comment about yours, almost all of them often include a "good-guy guarantee," which basically states you personally guarantee that your commercial lease rent would be paid up to the time you return the keys. So, with that in mind, I intend to pay all of my rent........ eventually... This is just a means to an end of getting rent relief from the city. I don't advocate you stiffing your landlord, this is why I mentioned "holding the rent."
However, I have been told by some of my legal friends... What is happening is, many leases, both commercial/residential have "natural disaster" clauses which basically protect the tenant in instances of "natural disasters." It was intended to protect tenants in cases of hurricanes,tsuanmis,eathquakes, etc etc... So apparently some commercial tenants are using this clause in the case of COVID being a natural disaster, and basically giving the tenant a way out of their rent since their premise is inoperable (I can see this being a problem down the road since it is somewhat valid).
City passed a law temporarily cancelling landlords ability to enforce personal guarantees.
https://therealdeal.com/2020/05/26/new-law-shields-restaurateurs-retailers-who-quit-leases/
30yrs_RE_20,
Users like you keep me coming back to SE/Talk to gain knowledge. Thank you for educating me.