Why Relationships Are Now More Important Than Ever In Commercial Property
Landlord-tenant relationships have always been important in commercial property, but now your business could depend on it.
As we continue through the uncharted waters of COVID-19, an amicable landlord-tenant relationship could be the difference between successful negotiations and business failure.
If you’re a landlord or a tenant, chances are you’ve already had a challenging conversation around rent relief and financial aid.
Unfortunately, this rollercoaster is far from over. We could all be in for a bumpy ride, which means that continually managing strong landlord-tenant relationships is going to be key as things evolve.
Building an amicable relationship from the beginning has a flow-on effect for everything that follows. You’ll have improved communication, understanding and a willingness to find a mutually beneficial outcome.
Maintaining this rapport for the long-term comes down to a number of important factors. Embracing them and staying flexible is paramount to your progress during these unprecedented times.
Your relationship needs to be:
Relational, not adversarial
Stay respectful and calm in your conversations, and avoid speaking (or acting) in a confrontational nature. You want to build up your relationship, not break it down.
Emotions play a huge role in the landlord-tenant relationship and will often determine the outcome of your negotiations. Everybody is feeling various emotions which may include frustration, fear, anxiety and even anger, but it’s those that keep these emotions in check and out of the conversation that maintain the best relationships. A poor relationship clouded by stubbornness and emotional communication will only shut down opportunities for success and increase your pain in these difficult times.
A symbiotic landlord-tenant relationship means both parties also need to be treated as equals – neither can survive without the other. Addressing this relationship balance will allow you to collaborate to create the best long-term solution for all.
Empathy on both sides
Have empathy and respect the other party’s financial situation. At the end of the day, you’re both facing business challenges right now, and more importantly, you both want to survive and thrive post COVID-19.
As a landlord, remember your tenant could be experiencing a severe business downturn and recognise that this may not be a short term thing – you may have to go on the journey with them as they re-build, pivot and re-create a sustainable future.
And as a tenant, remember your landlord has their own financial obligations which they need to uphold.
Being empathetic is also about compromising, being reasonable and staying realistic when working through your issues.
There’s no point in hiding information or lying about your situation. Both parties need to be honest and transparent about their financial situation. The more open you are, the greater capacity for empathy and finding a suitable solution. Remember, coming to a fast and fair resolution is good for everyone.
These honest conversations need to begin as soon as possible to ensure your relationship is sustained in the long-term. With circumstances continually changing, openness needs to be an ongoing thing. Tenants especially need to remain open about any improvements or further detriments you’ve experienced to your business or finances.
These days, a once off meeting simply isn’t enough. Just as our global situation continues to change and evolve each day, so will your financial situation. Ongoing communication is paramount in helping both parties co-operate as things evolve.
Depending on the circumstances, do what ever is necessary and achievable for both parties to facilitate regular communication, even if it means scheduling monthly catch-ups or pencilling in frequent zoom calls. Remember the greater your overall communication, the better off you’ll both be.
Work with a representative
The best way to facilitate a civil, professional and respectful landlord-tenant relationship is to work with an expert adviser.
At Broadway Property, we work with both tenants and landlord to negotiate outcomes that work for everyone, and can act as an independent support to help maintain great relationships.
Contact us to discuss your needs. No obligations.
Ben Heritage Managing Director, Broadway Property
Ryan Stewart, Director, Broadway Property