CHICAGO — How do you deal with rents? Are you a landlord? A renter?
Let’s hear today firsthand from a drycleaning owner who is both.
“My name is Joe Hebeka and I own the Belding Group, which consists of Belding Cleaners and two other previously competing dry cleaners that I have acquired in the last few years.
“We were founded in Detroit in 1918, and are now relocated in Grosse Pointe, Michigan, and have been in business for over 100 years.” he relates.
Hebeka says: “We currently own two of the three buildings we operate in, and rent space in the third.
“It’s interesting to be on both sides of the equation between renting and owning. Each has their pros and cons.
“Owning your own building can be very rewarding and a great asset, however, with that comes maintenance.... major maintenance,” he points out.
He relates that renting space on the other hand has many variables all depending on the type of lease you negotiate with your landlord.
“There is often less maintenance when renting, like snow and grass maintenance. Also, any issues with your space, exterior-wise or structurally, can just be forwarded to the landlord. It’s also significantly less of an investment when starting a dry cleaners to lease your space as opposed to buying a building.
“However, rent can be expensive and if things don’t go as planned, you’re usually on the hook for the remainder of the lease, whether your store is out of business or not,” he warns.
Consider the cost of relocating to a cheaper space and potentially losing your customers, he adds, it could be fatal to your business and the rent increase won’t seem so bad after all.
Hebeka says: “You can simply avoid most major rent hikes by communicating your needs and wants with your landlord before you sign the lease. If you have a great track record in business and payment history, you’ll be an asset because the landlord knows there is less of a risk and you can use that to your advantage when negotiating terms.
“The lease can be written in a way that forecasts the rate increases in the next five or even 10 years and gives you the first option to stay longer at a reasonably higher rate, or leave altogether.
“This is where a lawyer comes in. Trust me, the landlord has a lawyer, and you should to.”
Sounds words coming from experience.
“I view a busy dry cleaners as an asset to most landlords,” Hebeka notes, “especially with multi-space properties such as a plaza or strip mall shopping center.
“Almost all drycleaning transactions cause two visits from the consumer, the drop-off, and the pickup. Often times, within a three-day period of time. That’s valuable traffic and exposure for the other neighboring tenants as well as the landlord,” he points out.
The message here today is that rent hikes don’t have to be frightening if there is planning and communication. Just because Halloween is here doesn’t mean you’ll be scared by the next knock on the door!
“Bottom line,” Hebeka concludes: “There are endless variables and options when renting space and they should be handled professionally and cautiously.
“Take your time in finding just the right one that suits your specific needs!”
To read Part 1, go HERE.
Have a question or comment? E-mail our editor Dave Davis at [email protected] .