Small Business Today Magazine JAN 2015 AIM GLOBAL LOGISTICS | Page 32

EDITORIALFEATURE

Dealing with Landlords…The Good,

The Bad, & The Ugly - Part 3                 
By Jeffrey D. Jones, ASA, CBA, CBI

I

This can become a problem if you need to obtain a business loan which requires a first lien on
the business assets.  When possible, negotiate
with the landlord to either waive this provision
of the lease or at least be willing to subordinate
the landlord’s lien to a financial lender when the
business obtains a bank loan wherein the business assets will be the collateral.  This is often a
problem when a business owner applies for an
SBA loan.  The lender will require the landlord to
subordinate the landlord lien so that the bank will
have first lien.  Unless this is negotiated up front
with the landlord, it may become a problem at a
later date wherein the landlord has no obligation
to do so.

When searching for lease space, I recommend
Construction Costs
In the event you are taking on a new lease space, to business owners that they hire a real estate
the landlord will often provide funds to partic- broker who specializes in representing tenants for
ularly build out the space to your specifications.  space.  This specialist will be familiar with market
Typically, you are leasing a vacant space without rents and the terms and conditions that can be
built-in fixtures and plumbing.  The landlord gives negotiated with the landlord.  Typically, the landyou a lease space allowance to offset some of the lord pays the broker fee even when the broker
costs to complete the space.  This allowance wi \