CPA · Palos Heights, IL · Member since 2015 · 52 posts · 17 votes
Hi Everyone - I would love your suggestions -
Long term tenant ("Tenant") of 5 years has a good working relationship with the property manager ("Manager") of the building Tenant resides. Tenant requested to terminate the lease and perceived that the Manager agreed to the lease termination for a termination fee of 1 months rent, which Tenant paid.
There was a misunderstanding in the communication in that that termination of the lease was effective "with a new tenant". Thereby Tenant would remain responsible for the terms of the original lease until a new tenant was found. Manager and Tenant mutually agree that there was indeed a miscommunication and are looking for a solution where they could meet in the middle. A new tenant has not yet been found and the terms under the original lease expire in June of 2016. What would you propose?
Investor · Jessup, MD · Member since 2013 · 437 posts · 180 votes
10y
@Jon Rusnak This is more of a personal opinion based on the relationship between Manager and Tenant.
1) Hardline strictly by the written termination agreement..... Tenant pays until new tenant is found.
2) Flexibility...... Tenant pays 2x rent and is let go.
3) Very generous..... How quickly does Manager think he can rerent the unit? 2 weeks? If very quickly cut the tenant lose on the 1 month payment since the relationship has always been good.
4)Misc..... Does tenant know anyone looking for a rental?
Investor · Jessup, MD · Member since 2013 · 437 posts · 180 votes
10y
@Jon Rusnak This is more of a personal opinion based on the relationship between Manager and Tenant.
1) Hardline strictly by the written termination agreement..... Tenant pays until new tenant is found.
2) Flexibility...... Tenant pays 2x rent and is let go.
3) Very generous..... How quickly does Manager think he can rerent the unit? 2 weeks? If very quickly cut the tenant lose on the 1 month payment since the relationship has always been good.
4)Misc..... Does tenant know anyone looking for a rental?
Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
10y
All punitive actions only P*** off the tenant and the PM. Relationships get broken and everyone's reputation gets damaged.
All apparently agree on the miscommunication so all should attempt to mitigate the problem. Have everyone (tenant, PM and owner) attempt to provide possible new tenants and go from there.
I would try to split the damages three ways:
1) calc lost rents from first notice of termination up to the acceptance of the new prospect
2) split that amount between all parties, ie PM eats 1/3, Owner eats 1/3 and current tenant pays in the last 1/3.
Specialist · Lakewood, CO · Member since 2014 · 1k+ posts · 1k+ votes
10y
I don't remember where I heard this, so take with a grain of salt: Having a lease break fee is mutually exclusive with keeping the tenant responsible after moving out. If any landlords/attorneys know for sure, please confirm/correct me.
That said, the lease is a contract between parties, anything that those parties decide and agree on together can become the new agreement. Easy-peasy! Without being able to see where that communication failure happened, I don't know what compromise to attempt.