Make sure it’s all in a contract

Our story begins with an adventure many of you have probably enjoyed – looking for office space.

We were seeking about 2,500 square feet for Bill’s company, McQuade Consulting, in Canton. The spaces we were evaluating were pricey, and we started considering purchasing a property instead of leasing. So, in late March we took another entrepreneurial leap and became commercial landlords when we purchased an 11,000-square-foot property in Canton.

A little more than we were looking for, but we couldn’t resist. It’s beautiful. Open spaces, exposed architectural elements and a great location – 720 S. Montford Ave. at the corner of Montford and Essex streets, one block north of Boston Street. It’s close to restaurants in The Can Company and in the heart of a great neighborhood; not to mention only a few blocks from our house.

Before we had even moved McQuade Consulting into the top floor, we had a potential tenant for one of the suites on the lower level. It was a casual conversation that turned into a learning experience.

This potential tenant was renting space month-to-month at a very high rate. They had not been able to find a space they thought represented their business well nor met their budget. They stopped by to check out our new building and loved it – with a few modifications.

Weeks flew by going over the negotiation – the lease, the rent, the term, which party was handling renovation work, etc. Finally, all was agreed upon. We even secured a non-binding letter of intent – deposit check request was making its way through corporate.

Best part was they needed to move in ASAP, so rent was going to start coming in! We were under the gun to get the renovations done in less than 30 days.

Two weeks later, the check still had not arrived, and we had spent $14,000 in renovations. Then the call – –  the gentleman who was moving this particular division of the company over to our building had resigned, and now the company decided it was not going to move the division — it actually might close it.

Beyond angry having bent over backwards to get renovations done in time, we had two options: 1) hire a lawyer and sue, or 2)  lean on their compassionate side and ask for them to make it right.

Over the next several weeks, we tried multiple avenues, such as asking them to pay us rent for a few months to make us whole and simply cover our out-of-pocket expenses or move another division into the building . . . interestingly enough; the successful strategy was simply expressing how disappointed we were after taking them on their word.

Ultimately, they covered the renovation costs directly related to their requests. We were out a few thousand dollars, but not as much as we could have lost.

Our entrepreneurial advice – no matter how friendly the business relationship is, no matter how well you think you know the person, secure a contract.

If you should ever go the direction we did and trust someone on their word, give them time to honor their word. Why do all learning experiences cost so much money?