Communication is Key
When COVID began casting a net over the country nearly a year ago, the impact was anyone’s guess. Many commercial retail tenants quickly found themselves with limited revenue due to mandated closures, limited hours of operation, and quarantined employees. Restaurants, fitness clubs/gyms and hair salons were hit particularly hard. While the tenants needed a reprieve from their rent obligation, Landlords could not quickly (or easily) oblige without being granted a reprieve themselves from their lender. On a case by case basis, most Landlords did their best to accommodate by structuring a tenant repayment plan, or revising lease terms to close the gap.
Throughout the process, communication was, and still is, the most important part of the Tenant/Landlord relationship. Without clear and direct communication, Landlords have limited insight into the success or struggle of their tenants. When effectively communicating, Landlords and Tenants can work closely to establish payment plans, forgive late fees, and modify property expenditures, at least on a temporary basis. The roll out of the Payment Protection Program provided great relief to its recipients, providing the desperate means needed to keep the doors open.
Tenants were forced to get creative to drive sales while challenged with the ability to provide in person, face to face service. Those that had a strong business model prior to COVID, such as pizza delivery, saw significant increases. Others adapted by providing delivery service for the first time, creating a takeout only business model and modifying their in house programming to meet the demands of their carry out customers.
While the initial mandate to modify business practices was initially met with resistance, many businesses now recognize that they were at least given the opportunity to continuously operate unlike in many other states. With the recent announcement by Gov. DeWine of extended business hours for restaurants and bars, the news is getting better. Landlords and tenants both are cautiously optimistic that 2021 will bring stabilization driven by pent up demand for services, social interaction and desire to support of local, regional and national retailers and restaurants.
Oberer Realty Services, Ltd
3445 Newmark Dr.• Miamisburg OH 45342
) 937-531-5528 (dd) |) 937-776-3249 (cell)