A good friend, who happens to be an attorney, just asked me the other day over lunch whether he should renew his lease for a five year term or less. He told me he had concerns over his partners ability to keep his end of the bargin going in these uncertain economic times. I asked him if would prefer having flexibility concerning the length of the committment or having a locked-in lease rate that would save him money two to five years down the road. After he thought about his answer to the question he said that he would have more comfort in knowing that if his partner were to leave, he would not be tied into a long term lease. So I said, "you now have your answer". "Renew for one year, even if it is at the same rate you have been paying versus a two dollar reduction since this will give you the peace of mind to protect you if your concern over your partner becomes reality".
You should ask yourself the question that will unlock the correct answer. You know, the one thing that worries you the most...What happens if...Once you have the answer that is correct for you and your business situation then the length of renewal term will be obvious.
Thank you I was wondering that very same thing. Very helpful.
Posted by: Kevin Patrick | March 22, 2009 at 10:46 PM