There may come a time when you will have to ask for a rent reduction from your landlord. Rent is often the most significant expense for commercial tenants, and a slight decrease can greatly impact your business’s profitability. When is it possible to negotiate a lower rent with your landlord?
Feasible under certain circumstances
There are situations where you might have grounds to request a rent reduction, such as:
- Significant decrease in foot traffic or sales
- Economic downturn affecting your industry
- Major construction or roadwork impacting access to your business
- Loss of anchor tenants in the same commercial property
- Changes in zoning laws or regulations affecting your operations
- Natural disasters or unforeseen events disrupting your business
- Comparable properties in the area offering lower rental rates
- Landlord’s failure to maintain the property as agreed in the lease
In California, the COVID-19 Tenant Relief Act protected residential tenants from eviction during the pandemic. While this act has expired, it may exemplify how extraordinary circumstances warrant temporary changes in tenant-landlord dynamics.
In general, your landlord has no obligation to lower your rent unless specific terms in your lease allow for it. A well-drafted commercial lease with provisions for adjustments can be a solid foundation for negotiation if your business conditions change. Without such provisions, you may find it challenging to justify a rent reduction request.
Employ legal guidance to your advantage
You deserve tailored legal solutions for your real estate concerns. Before approaching your landlord, speak with a California attorney first. They can help protect your interests as you take the most appropriate actions.