Lease termination tips for commercial tenants: numerous options are available.

• Author: Grandfield, Jeff
• Position: REAL ESTATE

Considering where the Alaska economy is headed with the price of oil, you may be faced with terminating your own commercial lease. This process can be accomplished and it doesn't have to be a nightmare for commercial tenants, although you could face numerous roadblocks.

Understand that, as business owners themselves, commercial landlords need good rent-paying tenants to 611 their buildings. Empty commercial units do not generate any income for a landlord. Therefore, negotiating that initial lease should come quite easily. Should you need to terminate your lease, however, things may not be quite as smooth.

As The Lease Coach, we have been coaching and consulting with independent and franchise tenants since 1993. Over the years, tenants have frequently asked us how to "break a lease." Should the tenant continue to lose money? No. You have numerous options available that may or may not help you to terminate--perhaps with limited personal loss and damage. In no particular order, our professional recommendations are as follows:

* Understand the language. In reading this so far, you will have likely noticed we have spoken of "terminating a lease" rather than "breaking a lease." In the real estate industry, the term "terminating a lease" is preferred over "breaking a lease." In the latter case, this suggests that you, the commercial tenant, are doing something which is both legally and ethically wrong. A tenant's words, in fact, can set the tone for success or failure. We think of a quote from motivational speaker, Zig Ziglar who once said, "You can call your wife a kitten or you can call your wife a cat ... you'll get a different response."

* Talk to your landlord. The Lease Coach has been very successful in persuading the commercial landlord to take back the commercial space when the present tenant is struggling. The landlord can then re-lease the space. It is, in fact, to the landlord's advantage to precipitate a vacancy by working in advance to find a replacement tenant. This allows the landlord to maintain cash flow. Instead of a conspicuous "Going Out of Business Sale" sign in a tenant's window or a 'For Lease" notice on the outside of the property, the public will see signage welcoming a new tenant into the property. A "Coming Soon!" or a "Grand Opening" sign is far more attractive.

* Find a replacement tenant. Commercial landlords are more likely to be cooperative terminating your lease if a replacement tenant can be found for your space...