• Marketplace
  • Resources
  • Business Directory
  • Events
  • Advertise
  • Brand Pulse
  • Publish a Press Release
  • Get the Newsletter
  • Contact
  • About Us
The FUTURE OF WORK® since 2003
Allwork.Space
No Result
View All Result
Subscribe
  • More
    • Columnists
      • Dr. Gleb Tsipursky – The Office Whisperer
      • Nirit Cohen – WorkFutures
      • Angela Howard – Culture Expert
      • Drew Jones – Design & Innovation
      • Jonathan Price – CRE & Flex Expert
    • Get the Newsletter
    • Events
    • Advertise With Us
    • Publish a Press Release
    • Brand PulseNew
    • Partner Portal
  • Latest News
  • Business
  • Leadership
  • Work-life
  • Career Growth
  • Tech
  • Design
  • Workforce
  • Coworking
  • CRE
  • Podcast
  • More
    • Columnists
      • Dr. Gleb Tsipursky – The Office Whisperer
      • Nirit Cohen – WorkFutures
      • Angela Howard – Culture Expert
      • Drew Jones – Design & Innovation
      • Jonathan Price – CRE & Flex Expert
    • Get the Newsletter
    • Events
    • Advertise With Us
    • Publish a Press Release
    • Brand PulseNew
    • Partner Portal
  • Latest News
  • Business
  • Leadership
  • Work-life
  • Career Growth
  • Tech
  • Design
  • Workforce
  • Coworking
  • CRE
  • Podcast
No Result
View All Result
Subscribe
Allwork.Space
No Result
View All Result
Advertisements
Kube Suite - TL
Home Business

COVID-19: How To Have The Right Conversation With Your Landlord

Cecilia Amador de San JosébyCecilia Amador de San José
March 26, 2020
in Business
Reading Time: 4 mins read
A A
Landlords

The health crisis is hitting the flexible space industry, and operators are now having conversations with landlords to cut costs over the coming months.

  • The health crisis is hitting the flexible space industry, and operators are feeling the pinch.
  • Many operators are now in conversation with their landlords to try and reduce costs over the next few months.
  • In a webinar hosted by GCUC, Giovanni Palavicini, a real estate strategist, shared insights on how flexible workspace operators can approach their landlords.

The COVID-19 outbreak has disrupted industries across the globe. The real estate industry is no exception, and landlords and occupiers will both be significantly impacted.

Already, investors, property owners, and property developers are expecting a dramatic pause in leasing activity. Existing tenants, for their part, are hoping landlords will provide rent-free periods and delay evictions. 

Advertisements
Nexudus - Tech Stack Lovers

How will this impact the flexible workspace industry? More importantly, is there anything flexible workspace operators can do to work with landlords?

GCUC recently hosted a webinar on how to have the right conversation with your landlord. During the webinar, Giovanni Palavicini, a real estate strategist, shared insights on how flexible workspace operators can approach and talk to their landlords. 

Advertisements
Nexudus - Tech Stack Lovers

Here are the highlights of the webinar. 

“The key is to get to someone who can make a real decision,” Palavicini said. While some operators don’t have a direct relationship with their landlord, this is the time to start working on it, as your broker or manager may not be able to make a final decision or negotiate with you. 

However, before you reach out to your landlord, Palavicini says that you need to know your numbers and be prepared to show your books. Operators could also benefit from researching their landlord and knowing who they are and how they are structured. 

“This is an emotional time for everyone. But keep in mind that feelings are real, yet not reliable; landlords will want the facts and having your business numbers will show them where you stand and how you plan to get over this.”

Advertisements
Yardi Kube automates flex and coworking operations

In other words, flexible workspace operators need to have a strategy in place of how they are preparing for the future. 

It should be noted that some operators may be in a better position to negotiate than others. 

For example, International Workplace Group (IWG) reached out to its UK landlords asking for a three-month rent freeze in exchange for extending its lease for three months. 

IWG is a large company, and more importantly, it’s profitable. In other words, IWG has leverage, which smaller flexible workspace operators don’t.

More stories for you

Why Full Occupancy Is No Longer A Flexible Workspace Bragging Point

Why Full Occupancy Is No Longer A Flexible Workspace Bragging Point

3 days ago
New Report Warns Boston Office Values Could Drop 45%, Cost the City $1.7 Billion

New Report Warns Boston Office Values Could Drop 45%, Cost the City $1.7 Billion

6 days ago
U.K.’s Workspace Group Cuts Office Sizes As SMEs Favor Smaller, Flexible Spaces

U.K.’s Workspace Group Cuts Office Sizes As SMEs Favor Smaller, Flexible Spaces

1 week ago
More Office Space Removed Than Built in U.S. for First Time Since 2000

More Office Space Removed Than Built in U.S. for First Time Since 2000

2 weeks ago

Many flexible workspace operators are not yet profitable, which may make it harder for them to convince landlords to give them a rent freeze, delay evictions, or provide any other type of help. 

Palavicini told webinar attendees that “this is not a get out of jail free card.” Flexible workspace operators need to have a sustainable business and be transparent, otherwise landlords are not likely to want to help them out. 

Following the webinar, Allwork.Space spoke with Scott Harmon, Founder of Swivel, to talk about how landlords are responding to the pandemic. 

“It’s a chaotic time for everyone.

Advertisements
Maximize Flexible Space Revenue

“However, I believe landlords will do their best to work with their tenants. But they will need to make a judgement, and they will make that judgement based on the stability of their tenants.”

Harmon states that landlords usually cannot go a month or two before moving to eviction procedures. “Landlords don’t have a lot of equity, they mostly borrow money and if they go too long without rent, then their lenders could repossess the buildings.”

This is why landlords cannot give forbearance to everyone. 

Harmon believes that “if a business is likely to recover after this storm, the landlord will want to negotiate with them. If, on the other hand, a business is already struggling or will have a hard time recovering — whether it’s because the business is young or they don’t have a lot of runway — then the landlord might choose to evict.”

Advertisements
Disaster Avoidance Experts

The good news for occupiers is that landlords, in general, don’t want to see their tenants go away, particularly as they may find it hard in the coming months to fill the space. 

“I think their desire is to keep tenants in place, so we are likely to see a lot of renegotiation going on in the coming days and months.”

Harmon believes that we will see an increase in ‘blend and extend’ amendments. This basically means that landlords will extend current leases and negotiate a new rate with tenants. In the case of IWG, the blend and extend was a rent-freeze in exchange for a longer lease. 

In the end, landlords understand that this is a crisis and that they and their tenants are in the same boat. 

Advertisements
Disaster Avoidance Experts

Harmon, however, gave a word of caution to flexible workspace operators. 

“They may suffer from the WeWork fall; everyone followed that. Landlords are aware of what happened and many have turned more skeptical of the flexible workspace model.” Operators hoping to get help from their landlord will need to assuage fears and doubts about the sustainability of their business.

Advertisements
Subscribe to the Future of Work Newsletter
Tags: CRE
Share5Tweet3Share1
Cecilia Amador de San José

Cecilia Amador de San José

Cecilia is an experienced writer and editor with a background in strategic communications. She has written articles for Allwork.Space on several topics, including the future of work, flexible workspaces, employee wellness., and more.

Other Stories Recommended For You

Why Full Occupancy Is No Longer A Flexible Workspace Bragging Point
Coworking

Why Full Occupancy Is No Longer A Flexible Workspace Bragging Point

byEmma Ascott
3 days ago

Coworking success now hinges on engagement, not just occupancy or desk count.

Read more
New Report Warns Boston Office Values Could Drop 45%, Cost the City $1.7 Billion

New Report Warns Boston Office Values Could Drop 45%, Cost the City $1.7 Billion

6 days ago
U.K.’s Workspace Group Cuts Office Sizes As SMEs Favor Smaller, Flexible Spaces

U.K.’s Workspace Group Cuts Office Sizes As SMEs Favor Smaller, Flexible Spaces

1 week ago
More Office Space Removed Than Built in U.S. for First Time Since 2000

More Office Space Removed Than Built in U.S. for First Time Since 2000

2 weeks ago
Advertisements
Disaster Avoidance Experts

Unlock your competitive edge in tomorrow's workplace.

Join a community of forward-thinking professionals who get exclusive access to the latest news, trends, and innovations that are shaping the future of work.

©2024 Allwork.Space News Corporation. All Rights Reserved.

Exploring the Future Of Work® since 2003.

Advertise   Newsletters   Privacy Policy   Terms Of Use   About Us   Contact   Submit a Press Release   Brand Pulse   Podcast   Events   

No Result
View All Result
  • Home
  • Latest News
  • Topics
    • Business
    • Leadership
    • Work-life
    • Workforce
    • Career Growth
    • Design
    • Tech
    • Coworking
    • Marketing
    • CRE
  • Podcast
  • Events
  • About Us
  • Solutions
    • Advertise | Media Kit
    • Publish a Press Release
    • Brand Pulse
Subscribe

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
-
00:00
00:00

Queue

Update Required Flash plugin
-
00:00
00:00