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Not sure if this is the right section to ask but seems to be..
My parents run a pizza store and lease the location, 5 year lease is up in 8 months and the lease agreement they signed states they have a right to sign another 5 year lease and one thing they need to agree on with the landlord is monthly rent.
What's proper format for this letter, to notify landlord they want another 5 year lease?
It has to be handed in at least 6 months before lease is up, any tips on rent negotiations?
Have them send the letter to the landlord by certified mail, return receipt requested. In the letter they should say that they would like to extend the current lease for another 5 years at the same terms and conditions and ask the landlord to let them know if this is acceptable. Then wait for a response.
If he responds that it's acceptable then having a copy of your parents' letter plus his signed response is good enough. If he doesn't find it acceptable then your parents will have to negotiate with him and then it can be put it writing when it's resolved.
A simple statement indicating that they intend to renew the lease for another 5-year period from mm/dd/yyyy to mm/dd/yyyy is sufficient. As for negotiating a rent amount, they should research what their neighbors are paying for their rents for compatible facilities in compatible locations. They can also research current advertisements seeking tenants for vacant facilities similar to that which your parents lease and make an offer accordingly.
Pssst....Excon....if the OP uses my method and the landlord accepts the tenants' proposal in writing, then it's a perfectly acceptable, legal way of extending the lease at their current rent.
Current lease agreement guarantees us to extend the lease for 5 years with all conditions staying the same except the rent - we have to agree with the landlord on that BUT he cannot just give us a huge amount for rent so we don't renew the lease.
Current agreement states that if we cannot agree on a rent amount then we go to the government body in charge of that and they assign a fair amount of rent that both parties have to accept.
Question now is not rent increase but decrease, due to the economy..and any decrease is ok for us so we'll see what we can get.
Ok, here's what your parents should do: Send the landlord two copies of a letter (by certified mail) that they intend to renew the lease for an additional 5 years. They would like to pay a rent amount of $_____ per month and if the landlord is agreeable he should sign and return a copy of the letter and no further action should be necessary.
If the landlord doesn't agree to the rent amount then your parents will have to start from scratch. But if they make it easy for him by sending this letter, and he knows he won't have to deal with negotiations and attorneys, he may go for it. The signed copy of the letter will be a valid, legal extension and both sides will be bound by it.
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