Leasing Retail Space - Defaulting on the Lease

 by Pat Oconnor

 Relocation Clause

Many retail space leases provide the landlord the option of relocating the tenant at the landlord's expense. For example, consider a local retailer leasing 2000 square feet of retail space in a regional mall. The landlord is attempting to lease 10,000 square feet of space to a national retailer. However, to consummate the lease they need the 2000 square feet of space occupied by the smaller, local tenant.

You Lose

Even if the landlord pays 100% of the cost to move your store, you will incur a loss. In addition to the time spent planning and executing the move, it will disrupt your business. Some previous customers will believe you have gone out of business and instead of realizing you've moved to a different location within the mall. Relocation clauses are another issue where the interests of the landlord and the tenant diverge.

Event of Default

An "event of default" is when either party does not perform as agreed upon in the lease. In some leases, the landlord has the right to terminate the lease if the tenant defaults. This can include both objective and subjective issues. An objective issue is timely payment of rent. A subjective of issue could be a product or service offered by the tenant which was not initially contemplated.

Non-Financial Event of Default - Example

For example, the tenant initially sold skateboards but is now also selling clothing for skateboarding. (Leases often define precisely what business the tenant may perform in the retail space. From a technical perspective, even a slightly different type of business is a violation of the lease, which is an event of default.)

Financial Event of Default - Example

Most landlords and most tenants act reasonably. However, some people are unreasonable. Consider the following example. Retail space is leased at a fixed rental rate agreed upon 10 years ago. The contract rent is $15 per square foot but the market rent is $30 per square foot. The lease continues for another 10 years at the same rental rate. Due to a clerical error, the tenant forgets to send a rent payment one month. The tenant has an exemplary history of timely payment for the previous 10 years.

However, this is an event of default on the lease. Instead of calling the tenant to inquire regarding the current month's rent, the landlord sends the tenant a notice of default. The notice of default informs the tenant the lease has been terminated and demands the tenant vacate the premises within 30 days.

What is Reasonable?

A reasonable solution is for the landlords to provide written notice in the event of a default. The tenant should have a reasonable period of time to cure the default. This issue becomes more complex when it is not possible for either the tenant or the landlord to cure the default.

What if Landlord Can't Perform?

For example, a lease includes an affirmation by the landlord to comply with local laws and regulations. However, city council retroactively increases the parking requirements. (The number of parking spaces required per 1000 square feet of space.) This issue is being intensely litigated by local retail center operators. However, final resolution of the litigation is not expected for three or four years. Should the tenant have the right to terminate the lease in this situation?

Dispute Resolution

Most retail space leases address the venue for resolving disputes between the tenant and landlord. In most cases, the venue is state district court in either the location of the retail property or where the landlord is headquartered. The former is prevalent. There's a growing trend to require binding arbitration for disputes. The advantage it is a less expensive process to resolve differences of opinion. The disadvantage is forgoing some of your rights for a process which can be even more arbitrary than state district court.

Right to Terminate

Finally, tenants should consider providing themselves an escape clause. When starting a business, a high level of optimism and the excitement is typical and understandable. However, the actual business results sometimes fall far, far short of what was expected.

Right to Terminate - Example

For example, assume you had expected sales of $20,000 per week for your retail store and thought the very lowest level that could possibly occur would be $5,000 per week. Even though the $5,000 per week seemed like a very pessimistic scenario, you were comforted that the business would be profitable at this level. At least you'd be all the pay your expenses and pay yourself a barely adequate salary.

Example Continued

Unfortunately, the pessimistic scenario turned out to be wildly optimistic. For whatever reason, the stores only generating sales of $1500 per week. This is inadequate to pay your cost of operations.

What Rights Should You Require?

Should you have a right to terminate your five-year lease in this scenario? If you do terminate the lease, what is a reasonable amount to pay for expenses incurred by the landlord?

Beware of the Consequences

Although termination clauses and personal guarantees may seem like an arcane nuance when negotiating the lease for your new business, they are critical factors. If you personally guarantee the lease and do not have an option to terminate the lease if your business performs poorly, in a worst-case scenario you are faced with personal bankruptcy or funding an operating deficit for a long period of time.

Conclusion

This concludes the article on leasing retail space. By researching best practices for your competitors, carefully analyzing the demographics and psychographics of successful stores, identifying an appropriate submarket for your store, performing thorough due diligence regarding the retail space you are leasing and carefully negotiating the lease, you have substantially improved your chances of success. In addition, you will have mitigated your exposure in the event your retail establishment is not successful.



This information allows investors to compare competitive properties, facilitate business decisions and track market and submarket performance.  In addition the data is useful to brokers who for example continually monitor Houston retail space leasing, Houston office space leasing,   Real Estate Consulting  Dallas retail space leasing, Dallas industrial leasing, Houston industrial space leasing,  Leasing Retail Space - Due Diligence  Houston apartments, Dallas apartments, Fort Worth apartments, Austin apartments, and San Antonio apartments.

Article Source: http://www.articlesphere.com/Article/Leasing-Retail-Space---Defaulting-on-the-Lease/268308

Construction Property Management And Property Joint Venture

 by Sachin Airan

 Construction property management is important when it comes to any construction project, particularly those such as large developments. This type of service can provide you with peace of mind and allow you to focus on reaching the end goal of your construction project. The service will allow you to focus more on the immediate details of the building project, rather than on the small details and behind the scenes activities that come with construction property management. There are many benefits in using this type of service.

One of the biggest benefits of using construction property management services is that you have more time to worry about the immediate details of a project. Another thing that you can benefit from is that you will have professionals watching every detail of the project. These experienced professionals may catch things that you yourself might miss with everything that goes on in a job site.

Another thing you might want to consider for your construction project is a property joint venture. If you are working on a large development, or if you are working on an expensive commercial facility, you may need to have additional funding to get your project off the ground and completed in a timely manner. A joint venture can help you achieve these goals easily. Essentially, a company that goes into a property joint venture with you becomes your partner or investor. They have an interest in the development or the company that the construction project is for. And, as such, they will expect an eventual return on their investment.

However, it can be very beneficial to use a property joint venture for large projects. This is especially true if you, as a developer, do not have the immediate funds available to complete the development project. Often the rewards of such a project are not seen until after the development is completed. Therefore, funding is necessary to pay employees and contractors for the work performed on the project throughout the project while you are waiting on this end reward. This is when a property joint venture can come in handy.

In some cases, you can find construction property management services and a joint venture partner or investor in the same company. This is rare, but these companies do exist. They offer you with a much more personalized and complete solution for your development project. You will have the peace of mind that your project is being managed by someone with a financial interest in the development. This means that your project will definitely be well managed, because the company will want to make sure that they get a return on their investment for the joint venture. This is a unique solution that can be of great use to developers who need extra help in both managing and funding large development construction projects.

You may think that you do not want someone else managing your projects. However, construction property management services are actually there to help you, not hinder you. They will make sure that your contractors do not cut corners, and that you fall within all the governmental guidelines and regulations for your building project. They will also make sure that everything runs smoothly and on schedule. This can actually make your life easier, even though at first you might be wary of such services.



It is essential that you have someone in Construction Project Management that can look after the project. It can also be a good idea to go into a Property Joint Venture which will allow you to get more funding for your project.

Article Source: http://www.articlesphere.com/Article/Construction-Property-Management-And-Property-Joint-Venture/268365

11 High Cost Inspection Traps You Should Know About Weeks Before Listing Your Home For Sale

 by Rob Andress

 Homebuyers want to know your home inside and out while homebuyers are as individual as the homes they plan on purchasing, one thing they share is a desire to ensure that the home they will call their own is as good beneath the surface as it appears to be. Will the roof end up leaking? Is the wiring safe? What about the plumbing? These, and others, are the questions that the buyers looking at your home will seek professional help to answer. According to industry experts, there are at least 33 physical problems that will come under scrutiny during a home inspection. We've identified the 11 most common of these and, if not identified and dealt with, any of these 11 items could cost you dearly in terms of repair.

In most cases, you can make a reasonable pre-inspection yourself if you know what you're looking for. Knowing what you're looking for can help you prevent little problems from growing into costly and unmanageable ones. 11 Things You Need to Know to Pass Your Home Inspection

1. Defective Plumbing Defective plumbing can manifest itself in two different ways: leaking, and clogging.A visual inspection can detect leaking, and an inspector will gauge water pressure by turning on all faucets in the highest bathroom and then flushing the toilet. If you hear the sound of running water, it indicates that the pipes are undersized. If the water appears dirty when first turned on at the faucet, this is a good indication that the pipes are rusting, which can result in severe water quality problems.

2. Damp or Wet Basement An inspector will check your walls for a powdery white mineral deposit a few inches off the floor, and will look to see if you feel secure enough to store things right on your basement floor. A mildew odor is almost impossible to eliminate, and an inspector will certainly be conscious of it. It could cost you $200-$1,000 to seal a crack in or around your basement foundation depending on severity and location. Adding a sump pump and pit could run you around $750 - $1,000, and complete waterproofing (of an average 3 bedroom home) could amount to $5,000-$15,000. You will have to weigh these figures into the calculation of what price you want to net on your home.

3. Inadequate Wiring and Electrical Your home should have a minimum of 100 amps service, and this should be clearly marked. Wire should be copper or aluminum. Home inspectors will look at octopus plugs as indicative of inadequate circuits and a potential fire hazard.

4. Poor Heating and Cooling Systems Insufficient insulation, and an inadequate or a poorly functioning heating system, are the most common causes of poor heating. While an adequately clean furnace, without rust on the heat exchanger, usually has life left in it, an inspector will be asking and checking to see if your furnace is over its typical life span of 15-25 yrs. For a forced air gas system, a heat exchanger will come under particular scrutiny since one that is cracked can emit deadly carbon monoxide into the home. These heat exchangers must be replaced if damaged - they cannot be repaired.

5. Roofing Problems Water leakage through the roof can occur for a variety of reasons such as physical deterioration of the asphalt shingles (e.g. curling or splitting), or mechanical damage from a wind storm. When gutters leak and downspouts allow water to run down and through the exterior walls, this external problem becomes a major internal one.

6. Damp Attic Spaces Aside from basement dampness, problems with ventilation, insulation and vapor barriers can cause water, moisture, mold and mildew to form in the attic. This can lead to premature wear of the roof, structure and building materials. The cost to fix this damage could easily run over $2,500.

7. Rotting Wood This can occur in many places (door or window frames, trim, siding, decks and fences). The building inspector will sometimes probe the wood to see if this is present - especially when wood has been freshly painted.

8. Masonry Work Re-bricking can be costly, but, left unattended, these repairs can cause problems with water and moisture penetration into the home which in turn could lead to a chimney being clogged by fallen bricks or even a chimney which falls onto the roof. It can be costly to rebuild a chimney or to have it repainted.

9. Unsafe or Over-fused Electrical Circuit A fire hazard is created when more amperage is drawn on the circuit than was intended. 15 amp circuits are the most common in a typical home, with larger service for large appliances such as stoves and dryers. It can cost several hundred dollars to replace your fuse panel with a circuit panel.

10. Adequate Security Features More than a purchased security system, an inspector will look for the basic safety features that will protect your home such as proper locks on windows and patio doors, dead bolts on the doors, smoke and even carbon monoxide detectors in every bedroom and on every level. Even though pricing will vary, these components will add to your costs. Before purchasing or installing, you should check with your local experts.

11. Structural/Foundation Problems An inspector will certainly investigate the underlying footing and foundation of your home as structural integrity is fundamental to your home. When you put your home on the market, you don't want any unpleasant surprises that could cost you the sale of your home.By having an understanding of these 11 problem areas as you walk through your home, you'll be arming yourself against future disappointment.



Rob Andress is the Broker of Record for MINCOM Island City Realty Inc. Brokerage. With over 25 years of professional real estate experience in Brockville Rob's knowledge in invaluable. Formore details on brockville real estate and homes for sale in brockville than please visit our website.

Article Source: http://www.articlesphere.com/Article/11-High-Cost-Inspection-Traps-You-Should-Know-About-Weeks-Before-Listing-Your-Home-For-Sale/270215

Helpful Tips For Buying Your First Home

 by Leeanne Kunnert

 Purchasing your first home comes with many trials and tribulations.  In the first year after closing there are many valuable lessons to be learned.  Here are some things to think about as you begin the process of going from renting to buying.

 Think About The Future:  When buying your first home it is easy to get caught up.  At the time you can't imagine that you will ever need to sell this home you are about to start building your future in.  This however can't be further than the truth.  The truth is the first home you purchase will most likely not be the last one you purchase.  No matter where you are at or what stage you are at it is important that you take into consideration how difficult it will be to eventually sell when you are ready for the next step.

 Checklist:  When you are purchasing your first home, second or third, you will find it is quiet an emotional process.  It is quite possible to overlook things when your emotions start to take over.  Before starting your adventure into buying your first home create a checklist of must-haves, nice-to-haves and other essentials.  Print the list and take a copy with you to each and every house you visit.    Also bring with you a camera.  If you fall in love with a home but with your checklist and photos show that the house doesn't have any of the must-haves then at least it will make you rethink the purchase?

 Budget For Housing Expenses:  When considering what you can don't just consider the principal, interest, taxes and insurance.  You must take into account the amount you will spend on utilities, home improvement upgrades and costs to commute.  Can you afford the house, the extra expenses while living the life style you have become accustomed to?

 Look Into The Neighborhood:  Check out the neighborhood.  Is it a neighborhood that is full of children and growing families?  Do you enjoy the chitter-chatter of kids or will it drive you crazy?  Is the neighborhood full of older adults whose families have grown?  Did you plan on having kids?  Will the lifestyle you are considering for your future fit within the existing neighborhood?

 Look Beyond The Staging: We all think we are smart enough that we will not fall for the tricks that are used in staging however the psychology of staging works.  Homes look better when they are occupied.  When you are truly looking to say yes to a home it is important to remove the staging setup from your mind and consider your belongings in the layout of the home. Just because lights are sitting on the nightstands doesn't mean that there are plugs there to go with it.  Staging can play games with your emotions.



Lady of the Lakes Real Estate is Livingston County's premiere realtor; out of Pinckney, Michigan helping buyers buy and sellers sell homes that provide a recreational lifestyle including golf courses, lakes and the Huron river chain of lakes, throughout Brighton, Howell, Pinckney and the surrounding area. Find out more at http://www.ladyofthelakes.com.

Article Source: http://www.articlesphere.com/Article/Helpful-Tips-For-Buying-Your-First-Home/404119

Tips on How to Drive Prepared Always

 by Robert Banner

 Since you cannot tell when accidents or even minor road mishaps could happen, you should be prepared all the time. You should anticipate these occurrences so you can get out of the situation faster and get back on the road quickly and safely. At least you would be able to call roadside service when you need to.

Things to Bring

Since you travel everyday you should always make it a point that you have your cellular phone with you so even if you don't know anything about fixing you can easily call for roadside service. You can also call family and friends if you need moral support. The point is you would be able to call for help when you car breaks down or when you get into an accident.

An emergency kit would help you deal with the situation. In it you should have an "Emergency" sign and flares so you can signal that you need help. And then other motorists would also know that you are stationary on the road. This would prevent further accidents from happening. This would also let people who are coming to help you like the roadside service to locate you much easier.

You should have flashlights in the car or even in your purse too. This would help you see properly especially when you get stranded at night. It would also help illuminate certain parts of the vehicle if you are trying to do certain repairs or even when simply checking it out. It you are out in a dark area, it sure feels safer when you have a flashlight.

In cases of flat tires bringing an air pump would be good idea so you can pump some air on the tires so you can at least travel to the nearest tire repair station. If the roadside service would not be able to go to your location that soon, you would be able to bring your car to the repair station. If you are capable of changing tires, you can also do it. But you should have a spare and the necessary tools.

What to Do 

Engine overheating is quite common. So if it happens to you, simply raise the hood so the engine can cool down. Of course, you may want to check the cause of overheat as there could be more serious problems as well. On the other hand, if the engine or the battery dies you may need a pro to check up the car. This is when membership with an auto club may help. It would be more convenient to seek assistance. And it may end up cheaper as well.

Benefits of Auto Insurance

An auto insurance package can help you during minor or major road incidents. Some auto insurance packages can cover even car break downs. Whether you run out of gas or you need a major repair, the auto insurance package could also cover it. Some would even include hotel accommodation when you're stuck out of town while your car is being repaired.

Auto insurance or an auto club membership make repairing and getting out of a road incident more convenient and even cheaper. It would also be better to have emergency kits and tools with you always to make each travel safer.



You can find more imformation about Tips on How to Drive Prepared if you visit one of the leading firms in Denmark, the term in Danish is (  autohjælp  ).

More about driving prepared you can find if you visit this site.

Article Source: http://www.articlesphere.com/Article/Tips-on-How-to-Drive-Prepared-Always/264856

On the Road to Profits in China's Auto Sector

by George Leong

 Ever wonder how many cars are on the road in China? The estimates vary, ranging from 25 million to over 100 million. It seems no one really knows.

The Chinese auto sector had been sizzling, even overtaking the U.S. as the biggest car market in the world. With a middle class of over 300 million in a rapidly expanding Chinese economy, buying a car is paramount to the Chinese. However, the growth has been on the decline this year, as the government ended its tax incentives and jacked up taxes in order to streamline the number of new cars hitting the already clogged Chinese roads.

The Chinese car market grew 32% in 2010, but is estimated to falter to a mere three to five percent this year, according to the State Information Center.

So, while the Chinese auto sector will stall, it is clearly not dead. The demand for cars continues to be extremely high, as income levels continue to rise.

The key in China will be the rapid growth of the country's middle class. Credit Suisse predicted that the household wealth in China will double to $35.0 trillion by around 2015 based on achieving sustainable GDP growth at or near the current growth rate.

I have been a big supporter of the Chinese auto sector. Yes, the sector has slowed, but the massive potential is just too great to ignore. If you are patient, you need to have some capital in some of the Chinese auto-parts stocks or a play via U.S. automakers.

A lower-risk play on China's auto sector is General Motors Company (NYSE/GM). (Note that this is not a recommendation to buy the stock, but just an example to give you an idea of your options in this area.)

If you want to play via an U.S. automaker for less risk, General Motors is the top auto seller in China. GM and its Chinese partners (SAIC Motor and FAW Group) sold 2.35 million vehicles in 2010, well above the company's U.S. sales. The automaker is focusing its growth in China, as it feels the steady rise in the middle class will drive the demand for cars. GM will invest a minimum of $5.0 billion in China to try to reach a sales target of five million vehicles by 2015.

There is clearly some slowing in the Chinese auto market, but I view dips as an opportunity to buy for those with a longer-term view.

Consider that only about 41 in 1,000 Chinese own vehicles, according to some industry pundits. There is clearly ample room for growth, especially as the income levels continue to rise. This fact will drive vehicle sales going forward to the point where China will likely remain the top auto market in the world.

There are numerous ways to play the Chinese auto sector. You can buy an auto company on an American stock market with exposure to China, such as the major global automakers, as I discussed. Alternatively, you can buy Chinese auto-parts makers. Some interesting Chinese auto plays include China Automotive Systems, Inc. (NASDAQ/CAAS), Wonder Auto Technology, Inc. (NASDAQ/WATG), and SORL Auto Parts, Inc. (NASDAQ/SORL). Again, these are examples, not buy recommendations.



Retire On One Hot Stock! Sign Up For Your 100% Free Profit Confidential Newsletter!

Article Source: http://www.articlesphere.com/Article/On-the-Road-to-Profits-in-China-s-Auto-Sector/267777

Automobile - An Inseparable Part Of Our Life

 by Anthony Mendonza

 Around the world, there were about 806 million cars and light trucks on the road in and the engines of these burns over a billion cubic meters of petrol/gasoline and diesel fuel yearly. Today car is not considered luxury by most it has become a necessity.

Finance companies and Loans and availability of used cars have made it more convenient to own. Can you imagine the world without any single automobile? It's impossible to even imagine world without automobiles.

The first working steam-powered vehicle was designed by Ferdinand Verbiest, in China around 1672. It was a 65 cm-long scale-model toy for the Chinese Emperor.

Then somewhere in 1752, Leonty  Shamshurenkov, a Russian peasant, constructed a human-pedaled four-wheeled "auto-running" carriage, and subsequently proposed to equip it with odometer and to use the same principle for making a self-propelling sledge.
But the large-scale, production manufacturing of affordable automobiles was debuted by Ransom Olds at his Oldsmobile factory in 1902 based on the assembly line techniques pioneered by Marc Isambard Brunel.

Today's well known automobile manufactures around the World are Toyota, GM, Volkswagen, Ford, Nissan, Honda, PSA, Suzuki, Renault, Fiat, Daimler AG, Chrysler, BMW. Total of 77,743,862 automobiles were manufactured together by all for year 2010 as per records. These 4wheels not only drives our lives but the economies or the whole world in other words.

This is a great achievement as per economic growth, technology, development and living standards. But it is causing some serious bad effects to the nature globally, which we all are aware and concerned. Our Automobile manufacturers have already begun to manufacture vehicles with alternative powers or fuel which claim to be very low in harmful gas emissions. Rapid development is on to produce more eco- friendly and fuel efficient cars all over the world. New and better versions are added frequently.

Japan's contribution to automobile industry of the world started in 1960s with launch of new small cars in Japan. These small cars featured very small engines (from 360cc to 600cc) which kept taxes very low as compared to large cars. More and people in Japan could afford a car and brought about a boom in car demands in Japan market. Rapidly rising domestic demand and the expansion of Japanese car companies into foreign markets in the 1970s further accelerated growth.

During 1970s, and 1980s, the Japanese manufacturers like Mitsubishi and Honda gained a major foothold in the US and other world markets.  Export of Car was real high during this period. Japanese manufacturers produced very affordable, reliable, and popular cars throughout the 1990s, and Japan became the largest car producing nation in the world in 2000.

Some of the Hybrid cars on roads are Toyota Prius, Camry Hybrid, Highlander Hybrid, Volta, Sienna Hybrid, Hybrid X, A-BAT Concept Hybrid Pickup Truck, Nissan Altima Hybrid, Mazda Tribute Hybrid, Honda Civic Hybrid, Insight, Fit Hybrid, CR-Z Hybrid, Accord Hybrid, Mercedes ML 450 Hybrid, Mercedes S400 Blue Hybrid, BMW X6 Hybrid, BMW Active Hybrid 7.

Some of the electric vehicles on roads are: Nissan LEAF, Toyota RAV4-EV , Nissan ALTRA EV , Honda EV PLUS and more are on their way to be launched.

Go for the ECO-FRIENDLY automobiles and help save the Earth for our children.



Check details and photos of most popular used cars from Japan at www.jimex.co.jp to import direct from Japan. Jimex Co. Ltd. is one of leading and trusted exporters for quality used cars from Japan for last many years. We export any kind of Japan used car any part of the world.

Article Source: http://www.articlesphere.com/Article/Automobile---An-Inseparable-Part-Of-Our-Life/269246