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Newsagents: beware the lease negotiator

I said no thanks to a landlord proposal for a newsagency in a shopping centre a few years ago as my assessment at the time was the offer was not viable. The landlord would not move enough to make the opportunity viable.

A newsagent subsequently took on the tenancy, with a lease negotiated on their behalf by someone claimed to be a good negotiator. Sure enough, the business went broke, costing the newsagent hundreds of thousands of dollars.

The lease ‘deal’ was no deal at all. While their negotiator got paid for their service and the landlord got their rent, the business operator paid the price.

In hindsight, given what was negotiated, the lease negotiator appeared to be more concerned about getting the shop than the long-term viability of the business they were negotiating for.

Be wary of anyone saying they have negotiated a lease deal for you. Do your own research, check the viability for yourself. Landlords run with strict financial models. While they have some room, the amount of room they have is usually considerably less than some promoters of lease negotiating skills suggest.

The family taking on the business I rejected have lost plenty. sadly, the story is the same for some others taking on leases negotiated by the same ‘expert’.

If you are paying a lease negotiator, have a written agreement with them laying out your requirements and tying their fees to proven viability of what they negotiate. Ensure the lease costs proposed fit with your business plan and that the permitted use clause is appropriate to the future plans for the business.

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Newsagency management

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