Tenant relief — quid pro quo discipline
Vacancy economics almost always exceed reasonable concession economics — keep paying tenants in seat. But concession without quid pro quo is value destruction. Preference order: deferral with explicit repayment; deferral + lease extension; abatement + extension; percentage rent in lieu of fixed; pure abatement only as last resort.
The asymmetry: landlords give up cash now; tenants give up flexibility later. Capture the flexibility while leverage exists. Specific exchange ratios — like one month of abatement traded for six to twelve months of lease extension — are leasing-broker rules of thumb, not formulas; the right trade depends on rent level, tenant credit, time value, and replacement cost.
Segment tenants into three buckets: Strong (paying through stress — leave alone); Stressed-but-viable (the workout candidates — quid pro quo applies); Going-concern-doubt (will fail regardless — start the marketing of the space now). Treating all tenants the same is the most common single error in crisis tenant management.
For small landlords: the same principles scale down. A 6-month deferral with a written repayment schedule is much better than a 6-month gift. Document everything; involve counsel for amounts over a single month's rent; if you suspect the tenant will not survive, start marketing the unit immediately rather than waiting through six months of accumulating arrears.