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Malibu Brief: Eviction alternatives for Malibu businesses and landlords
It’s no secret that commercial rent in Malibu is high.
Malibu rates range from $52 to $84 per square foot. Compare that with Santa Monica and Calabasas, where commercial rates are as low as $42 and $21 per square foot, respectively. But to many, the beauty and prestige of Malibu justify the extra expense.
Each day, attorneys at Harrison Barnes PLC review lawsuits filed by, or against, renters and property owners. Recently, we have observed a spike in Malibu commercial landlord/tenant evictions and related litigation. Unfortunately, many of these disputes could and should have been resolved long ago with results that would have been better for both tenant and landlord. While there are exceptions to the rule, from a business standpoint, eviction should be a last resort for both landlord and tenant.
Savvy landlords often seek to avoid eviction to avoid the uncertainty associated with finding a replacement tenant and the difficulty of collecting past rent and other damages from an evicted former tenant. In addition, landlords enjoy the security of an ongoing relationship by knowing whom they are working with and how their property will be treated. Therefore, when trouble strikes, landlords have an incentive to negotiate with a current tenant to enable them to remain at the properties rather than evicting to find a new tenant wherever feasible.
If you are a Malibu business owner struggling to pay your rent, don’t bury your head in the sand. Rather, consider sitting down with your landlord as early as possible to discuss the situation and explore what can be done to avoid eviction. Let the landlord know your business has potential, you are committed to the location and you appreciate him or her working with you to find a mutually agreeable solution that will enable you to keep your doors open. To show good faith, ensure the landlord that missed payments will be paid off on a feasible schedule. You might also remind the landlord of how well your company has taken care of the property during its time there.
If possible, find an alternative to paying currently owed rent, such as negotiating a different method of calculating your monthly rent. For instance, the landlord may allow you to pay a reduced rate during low-income periods and higher rates during months which produce stronger income. This arrangement is particularly applicable in Malibu, where many businesses generate significantly more income in the summer months. Remember that landlords are business owners too, and as such, they may be inclined to work with tenants toward achieving the solution that best impacts their bottom line, particularly if approached before the tenant falls significantly behind on its rent.
Finally, tenants should consider the possibility of subletting or assigning its lease. Read the lease agreement first and send it to your lawyer before making any decisions. Be sure to discuss this with your landlord prior to making any such changes, as many lease agreement explicitly prohibit assignments and/or sublets or require landlord’s advanced consent.
Keep in mind that the above discussion is general in nature and does not apply in all circumstances. Business owners should have a qualified attorney assist them with an analysis of their particular situation and negotiations, as well as the documentation of any agreements reached.
Harrison Barnes PLC is a Malibu-based law firm founded in 2000.