this has been on my mind:
how have you mitigated risk of a loss of lease, leading to loss of your investment?

i don’t see any ideal solution, if a long-term lease is undesirable. but in the absence of a long-term lease, there is exposure or even room for exploitation.

scenario: mom and pop business, salon/spa, purchase and build out of business is tens of thousands (any number you like). if not renewed, then everything is lost. there is no business to sell. it’s impractical to strip and store fixtures, hoping to sell used equipment. leaving the space empty for a couple of years would pay off for a landlord who wanted to pick up a ready-to-run spa.

seems like this is a risk for any small shop that can’t commit to indefinitely renewable lease. what’s a good practice? i suppose you need to discount the apparent value of such a business, before you settle on a purchase price.

  • beamdriver@alien.top
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    1 year ago

    You need to speak with a real estate attorney who is an expert in commercial leases. Have them evaluate the current lease and see what the risks are. Have them suggest lease terms that could offer the protection you’re looking for, then see if the current landlord is open to extension/renegotiation.

    Commercial leases can be quite complex and it’s best to have an expert to guide you. If you try to DIY things based on Google searches and/or advice from Reddit, you could end up in bad place.