​Ask and you may receive

At the time of this writing, retail vacancy rates were forecast to rise to 19.2 percent for the end of 2021, surpassing the previous high of 17.6 percent in 2010, according to Moody’s Analytics. But what sounds like bad news for the state of the industry could actually be good news for restaurant operators looking to negotiate and renegotiate contracts with landlords. Landlords want to keep their good tenants operating, and according to Amy Eskola, a partner with the law firm Messner Reeves who specializes in real estate transactions and contract negotiation, there is a lot of opportunity for operators to secure more beneficial terms right now. During a recent podcast interview with Elliot Maras of Kiosk Marketplace, Eskola said operators are (often successfully) seeking to adjust their contract terms in a wide variety of ways right now, including rent adjustment, abatement or deferment; basing rent on a percentage of sales, and for new locations, negotiating longer buildout periods, arranging to have rent commence at the time of permitting or opening, or securing a lower rent for the first year of operation. Anything is possible if you can present a solid, thoughtful case for it. Before approaching your landlord, conduct some market research so you have a clear sense of what terms similar businesses in your area are getting. If you’re seeking an agreement that hinges on your sales, also ensure you can present clear and organized financial statements that demonstrate your plans to manage expenses and build the business over the long term.

---