ReSolve successfully negotiates rent reductions with landlords - Resolve Group UK

ReSolve successfully negotiates rent reductions with landlords

Resolve Group UK

ReSolve successfully negotiates rent reductions with landlords

ReSolve’s restructuring specialists have recently been engaged on two separate assignments to assist clients in difficult negotiations with their landlords, seeking much-needed rent reductions. 

Both clients run historically successful businesses, but are being severely affected by a downturn in confidence amongst their customer bases amid the ongoing global trade wars, Brexit uncertainty and consumers reeling in their discretionary spending. Coupled with rising rents and business rates, these factors have squeezed margins to the point where survival of the businesses is under threat, unless they can secure sizeable reductions against their premises costs.

Working closely with the clients, we have approached their landlords to explain the position, backed up with reliable financial information about the clients’ businesses, together with data on the cost of alternative premises and the down-side outcome for all parties if the business fails, so the landlords can see the problem is genuine and are encouraged to enter constructive dialogue. ReSolve acts as an “honest broker” in the ensuing landlord / tenant discussions, helping to find a mutually satisfactory compromise that is sustainable for both parties.

ReSolve Senior Partner, Cameron Gunn, explained

“No one likes to see a good business fail just because it is saddled with unaffordable leases. Assisting the business to reduce its rent burden in a consensual way, through constructive negotiations with landlords, is often a much quicker, more elegant and less expensive way of solving this problem than the company entering into a full-blown CVA. Most landlords understand the importance of keeping hold of good tenants, even if it means accepting short-term sacrifices through temporary rent reductions. We find that helping both sides to identify the real position and then their goal-congruence is key to a successful outcome.”

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