How do you explain why the rent is increasing?

Question

How would you explain to a long term Commerical tenant that we need lease renewals with increases? They have been with us since 2010 and are upset they are getting a 30 dollar increase.

Dennis M. · Answer

Tell them gas And upkeep for your Lamborghini isn’t cheap these days so he must pay more to cover the extra costs of maintaining it .

Theresa Harris · Answer

If they've been there for 10 years without any increase, show them the comparable rents in the area.

Lesane T. Johnson · Answer

I use the cost of Living / Maintenance. Tell them a small increase will come to make up for cost of living every year from now forward.

Jaysen Medhurst · Answer

@Antoinette Wooden, they're complaining about a $30 (Thirty dollars) increase over 9 years? Tell them what the market rates are (I'm sure you're still below). If they want to leave over $30...good riddance.

Antoinette Wooden · Answer

@Linda S. Thank you when they are in front of me I can't think of anything but knowing thr market increases so I want to say it professionally without losing a tenant.

Linda S. · Answer

@Antoinette Wooden,

I'd tell them that you haven't raised rent in 9 years, and to expect a small/modest increase each year from now on out.  Taxes/insurance/inflation/Maintenance/etc-- it's all gone up!

John Underwood · Answer

Property Taxes, Insurance, CPA, Cost of Living (COLA).

Tell them you have held their rent low, but must make a modest change to keep from getting to far below market rent.

Jason Hendrickson · Answer

Run comps, show them the numbers. Explain you're just keeping rent inline with the market and adjusting for any increases in tax, upkeep, whatever. Then write into your lease that price will be evaluated at some interval (yearly, whatever) and adjusted for increases in market rate as well as taxes, insurance, whatever.

Antoinette Wooden · Answer

@Jaysen Medhurst yes I am way below market rent but they always send me referrals. However I don't ask for referrals in exchanged for rent to stay the same.

Alex S. · Answer

Everything went up in price since 2010. Tell them due to the rising cost of maintenance went up and the price has to go up too.

How do you explain why the rent is increasing?

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