Leases, like all legal documents, should be reviewed by an experienced attorney. We have been negotiating restaurant leases on behalf of clients for decades. Your real estate broker and the landlord have an interest in getting the lease signed with a good term and fair rent, but the fine print is ultimately your responsibility as the business owner. You will most likely be asked to personally guarantee a large portion of the future rent, which can be hundreds of thousands of dollars over the course of many years.
The lease for your restaurant is probably your single most important asset. Not only do you want to hedge against the downside risk of the restaurant not performing to your expectations, but you also need to protect against losing your space and wiping out all of your goodwill because you have to close or move. We have seen too many restaurant owners so excited to have a space to call their own, that they overlook the details of the lease until it is too late. What if you want to sell your successful restaurant in the coming years? Is the lease designed to maximize your exit or is your landlord suddenly your partner?
Most landlords will demand fees beyond the base rent and it is critical you understand and negotiate your true cost of occupancy beyond the base rent. Let us help you and use our decades of experience with landlords, through good times and bad, to get you the best deal possible for this critical investment. You are going to pour your heart and soul into this new restaurant, so don’t have your lease be a ticking time bomb sitting in the drawer that could derail all you have built. We understand how to balance the legitimate request of landlords against a restaurant owner’s very real legal needs when it comes to signing a lease. We will negotiate hard on your behalf, without killing the deal or turning off the landlord.
Our first step is a thorough review of the landlord’s lease, marking up requested changes, comments and any concerns we may have with the language. This first step is critical. It is very difficult to get any further changes not asked for in the first round. And if your attorneys take weeks to give the landlord initial comments, you could be compromising your leverage to get concessions.
After we discuss, fine-tune and agree on that first round of comments, it is presented to the landlord. Then a conference call is scheduled to come to terms with what is agreeable and to identify all the remaining outstanding issues.
The last steps are to negotiate the remaining issues and to work with the landlord’s attorney to prepare a signature-ready final version. We understand how critical this step is for you to open your restaurant, and we know how to play the role of expeditor—chasing, pushing and pulling all the parties over the finish line.