Wednesday, August 15, 2007

I had been in limbo for some time over Pegasus, Too. That, in fact, was part of the problem. I'll try to explain what happened without casting blame, because I think the landlord and I were coming at this from two different directions. I understand his viewpoint, I just needed what I needed to get there and wasn't getting it.

We seemed to be working on two different time scales. From the time we first started talking, he seemed to think it was all going to come together fast, he could get me in there in October at the latest. I looked at the raw footage and thought he was being very optimistic. We settled on a November 1 starting date.

But then pretty much a month passed without my seeing any real changes. Now in talking to the landlord, I could see that he still wasn't worried, that November 1 starting date still looked easy to him.

The problem was, a month had passed without me being able to do anything because everything I wanted to do depended on a secure lease. I spent $4,000 in the first two weeks, called all my suppliers to see what deals I could get, I perused catalogs and outlined what fixtures I wanted to buy, and so on. But when I didn't hear anything, I started to slack off. I had signed the letter of intent on July 17, and I then called him on 26th, and then had to send my orders off on July 31. (A bulk of my NOVEMBER orders had to go out on that day.)

So that was problem number one. I had envisioned a 3 month span to do everything in a nice, measured manner, with reduced stress, time to really plan and think and order correctly, to try out different fixtures, to stockpile material (especially to take advantage of all the sales) and so on. And suddenly an entire month of that was gone.

Now I know from his perspective, nothing had changed. November 1 was still a go.
But from my perspective, I still wanted the 3 months, and that meant pushing it back to December 1.

Which leads to the second problem we had. Communication. I get the feeling that we are both personalities that prefer to have people contact US, rather than the other way around. I had dropped by the location 3 times following the Letter of Intent to chat; I called him on the 26th of July. (In which conversation he mentioned that he'd have the lease ready 'in a few days.') Then I felt it was his job to call me, because after all he was the one who knew where things stand, not me. At what point does my calling become nagging?

We connected almost by accident last Thursday, August 9th, though it happened through my outreach efforts (I was calling another tenant prospect to ask if she knew what was happening and he happened to be there.) Again he said he would have a lease ready by Saturday.

At this point I very clearly and distinctly asked for the lease starting date to be December 1.

I got the lease yesterday, Tuesday, August 14, and it still had the November 1 starting date. This, by my reckoning, would necessitate at least a couple more rounds of back and forth, and especially since he didn't really want to commit to the December 1 date, I figured we were at a stalemate.

The final breaking point for me was that the lease included a 180 day termination clause, at the landlord's sole discretion.

Now maybe I could've negotiated this away. But I was going to have to see a lawyer, clearly, and now

well, I'm done.

So there it is folks. No one's fault, just negotiations that from my temperament and standpoint went too long and got too complicated.


Keeneye said...

180-day clause. That's what pushed out Azillion Beads as well.

From the Bulletin article, May 28, 2007:

For [Azillion Beads] Blanton, it's the second shake-up in less than five years. She moved out of one of the Eriksen family's buildings on Brooks Street downtown shortly before they bulldozed it to make way for a condominium and retail project that is currently stalled. Now she's 2 1/2 years into a five-year lease at the Mill Quarter, where she took out two loans on her family's house to pay for $30,000 or so in improvements, and she has been told she has six months to leave.

Getting evicted from your space after you've already made it your own -- that's just scary.

I agree with the comments on your previous post. Own the dirt.

dkgoodman said...

I like a relationship to have give and take. If it's all one-sided, it's not for me.

"Work with me, here!"

Duncan McGeary said...

Want to hear something really weird? Azillion beads is going into that same building.

I knew that she had vetted the lease through her lawyer, and asked the landlord if he was giving me the same lease as she had looked at.

He said yes.....

Anonymous said...

The final breaking point for me was that the lease included a 180 day termination clause, at the landlord's sole discretion.

Sounds like if he could find a top dollar buyer he would sell ( 180 days to close ), and have it both ways with somebody in, ...

Too bad you didn't get to see his lease terms early on to not waste your time.

It goes both way sometimes when I lease ( as an owner ) month-to-month they want $10k improvement on my nickel. I do it long-term or short-term, either way they pay improvement, for short term lease as-is, take it or leave it. My point is there are a lot of un-reasonable folks on the commercial side both sides of the lease. The important thing is find out in the first week exactly what the game is, and run if you smell shit. Some of these people demand more on improvements than income per year, take a leap I say.

Obviously this person was NOT in it for the long haul, good that you found out early, too bad you didn't find out earlier.

Location, location, location. Just wait and be patient and have your 20% down, and there are going to be a ton of once in a generation commercial deals in Bend in the next 2-5+ years. Then you can do whatever you want and never deal with a landlord again, make sure the payments are low, and you get a fifteen year fixed so that you can be generating income when you retire ASAP.

Duncan McGeary said...

I just talked to my current landlord (my landlord for the last 24 years) and she said that the 180 termination clause was NOT a normal clause.

I've negotiated about 14 leases between my four stores, and none of them were this difficult.

Buying the dirt is an option. Renewing my lease for another 5 to 10 years downtown and retiring is another option.