Failing lease with personal guarantee

[Ash Patel]

One year ago, I purchased a property for $550k and signed a tenant to a 10 year lease.  The proprietor was a coffee shop/bookstore that was operating down the street.  They wanted to expand as well as offer food and alcohol.  In addition to the $550k purchase, I paid $62k in TI, offered six months of no rent then six months of half rent.  Just as we start full rent, I am finding out that the business is bleeding cash.  The husband and wife both have assets and they both signed a personal guarantee for the full 10 year lease.  These two individuals went from selling coffee and books in a small footprint to now operating a bar/restaurant/bookstore in a large space.  They are not experienced restaurateurs but are mature and intelligent individuals.  The wife runs the business and the husband helps out but has kept his job as a high level analyst for a large multi-national bank.

They have called a meeting to discuss their situation. I will not offer any more concessions and my advice will be to get an experience consultant to help them.  Does anyone have experience in enforcing a personal guarantee on a commercial lease default?  My goal would be if they default, to come up with a settlement and release them from the lease, but if we cannot agree on terms, I am concerned with what the outcome of legal proceedings would be.  Another scenario would be that they sublease the building but retain the guarantee.  Not asking for legal advice, but would like to hear if you have experienced this.  THANK YOU!!