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Ways in which a new commercial tenant can show a landlord their financial strength (especially in a tight market)

05 Thursday Oct 2023

Posted by almak536 in Uncategorized

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#GTA real estate, bank statements, business plan, CRE, credit, credit report, creditworthy, financial statements, financial strength, guarantor, landlord, references, retailer, security deposit, tenant, transparency

Here are some ways in which a commercial tenant can show a landlord their financial strength:

  1. Provide financial statements: The tenant can provide their financial statements to the landlord, including income statements, balance sheets, and cash flow statements. These documents will show the landlord the tenant’s financial performance, liquidity, and ability to pay rent.
  2. Credit reports: The tenant can provide their credit report to the landlord to show their creditworthiness and ability to pay bills on time.
  3. Bank statements: Providing bank statements will show the landlord the tenant’s cash position and how much money they have available to pay rent.
  4. Business plan: A well-thought-out business plan that includes projected income, expenses, and profits can show the landlord the tenant’s long-term viability and potential for growth.
  5. References: Providing references from suppliers, customers, or other landlords can give the current landlord a better sense of the tenant’s reputation and reliability.
  6. Guarantor: If the tenant has a parent company or an individual guarantor with a strong financial standing, they can offer to guarantee the lease payments. This can provide additional security to the landlord.
  7. Offer higher security deposit: The tenant can offer to pay a higher security deposit to the landlord to show their financial strength and commitment to the lease.

Overall, the key is to be transparent and provide the landlord with as much information as possible to demonstrate the tenant’s financial strength and stability.

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