Oct
07
How can I terminate a commercial lease w/o paying future rent?
By
Our 5 yr lease turned out too expensive. There is a 50% buyout clause if exercised in the first 3 yrs. (just ended yr 2). Business partner’s personal financial situation changed for the worst and has NO money to pay the buyout. We have personal guarantees on the lease & “jointly and severally” (my least favorite phrase) signed. Any hope to terminate with out paying? What should I double check for in the lease?
The business has been for sale for @ 6 mos. at a drastically reduced price…just to walk away w/o owing anything. No subletters willing to pay the full amount (or even close!)
Repossession
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6 Comments
May 7th, 2009 at 11:56 am
Sounds like you will be stuck paying the buy out clause. If the lease is in the name of a company, you could bankrupt and liquidate the company and may be able to get away without paying, but with the personal guarantees, that may not even work.
Have you tried subleasing the property.
Jeff
May 8th, 2009 at 6:30 pm
Look for another lessee who’s willing to pay as much or more and, if all else fails, have a talk with the lessor to see what they’re willing to forgive.
May 10th, 2009 at 4:39 pm
Many companies go into Chapter 11 bankruptcy to re-negotiate their leases. This would be a completely legal way to break your lease.
May 13th, 2009 at 11:42 am
If you have a lease, you can’t. You signed an agreement, and you are now bound by what you signed. Check with an attorney for sure, but you bought it, you pay for it.
May 14th, 2009 at 7:28 am
If you could make the building ready for lease and get someone else to take over your lease, that would work
maybe you should advertise the property for lease.
Have you asked the chamber of commerce for help? you may qualify for a grant to help get the business up and running right.You could go to the mayor or to the city counsil for help.
May 15th, 2009 at 6:43 am
I say if all else fails, maybe strike up a conversation, and take them out, befriend them…. maybe if you become a little personal, they may just look the other way. Good luck..