One of my clients has been struggling to pay his $13,000/month lease. During a phone call about a year ago, his landlord told him, simply, “pay what you can.” At that time my client began paying about $6,000 a month while begging the landlord to move him to a smaller space within the same complex. Though the landlord never moved him, the client continued to pay the reduced rent.
The complex was recently sold to a new owner whose asset manager (during a meeting at which the client’s accountant and I were both present) assured my client that his reduced payments were fine and would become irrelevant as soon as she found him a smaller space within the complex for about the same rent. Her words, and I quote: “You have been tenants here for years and we want to keep you.”
A short three months later, my client called in a panic. He had received a Five-Day Notice to Pay or Quit, which means the landlord will lock him out of his space unless he manages to cough up close to $55,000 in back rent and associated late fees. All the “don’t worry about” assurances were quickly forgotten by the new landlord and his asset manager.
If, like so many businesses, you are struggling to make your rent payments and your landlord has verbally approved a reduction in rent, GET IT IN WRITING. Insist that the landlord provide you with an amendment to the original lease which lists the reduced rent and how long the reduction will last. Make sure you sign this amendment before another month passes, amounting to another month added to the default amount.