In the Spotlight: Supporting Struggling Tenants

In the current economic climate, owners of retail shopping centers and office buildings alike are being barraged by tenant requests for rent forgiveness or deferral. Since landlords are loathe simply to forgive a tenant's payment obligations, the popular approach has been for landlords to defer a portion of the rent for payment later during the lease term. The hope is that the improvement to the tenant's cash flow will allow the tenant to avoid going dark in the short term. When the economy eventually improves, and tenant's cash flow along with it, the tenant should be able to resume full rent payments and also repay the accumulated deferred rent amount over a period of time. In deciding whether to grant a rent deferral, landlords should consider certain issues and strategies. This two-part article will discuss nine factors every landlord should consider.