Since the outbreak of the coronavirus (COVID-19), we have received countless questions from clients asking the effect of the shutdown on their business lease situation, and in particular if they can withhold their rent. We have been asked, for example, would not the force majeure (so-called acts of God) clause excuse their performance. In the vast majority of cases, the answer is no. Unfortunately, we often have to tell them that their leases do not permit them to simply stop paying rent, even during the current crisis. For more detailed information on possible contractual issues including commercial leases check out Contractual Obligations in Response to COVID-19.
However, this does not mean that we cannot assist in trying to get you some relief under your business lease. As the crisis continues, we are working with clients to renegotiate their leases, on at least a temporary basis, or to obtain rent abatements or deferrals among other restructuring tactics. Contact your attorney at Carlile Patchen & Murphy LLP or any member of the Real Estate Law Group to discuss how we might be able to find you relief to ensure the survival of your business.
Unfortunately, businesses are struggling across the board, and no one is safe from the aftershock of this virus. My tenant reached out to me on March 18th, saying that they wanted to continue to pay their employees, however, their business was borderline shut down due to their clientele cancelling appointments, even before the full stay-at-home order went into effect. As a result, they requested a 60-day deferral so that they could take a couple months without having to pay their lease. I sent their request over to Geoff Kunkler and Jordan Butler at CPM and they helped me put together an offer that made sense, so that they could continue to stay in business, all while helping me recoup the cost over time.
Adam Koos, CFP®, CMT®President / Portfolio Manager, Libertas Wealth Management Group, Inc
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