[kylecordes]

Unfortunately, many businesses are arguably a bit worse than that: success this year means you put even more at risk next year.

(For example, you get successful enough that you need a bit of office space. Well, your little business is not going to persuade anyone with nice office space to lease to it alone... Landlords will instead demand the owners personally guarantee the lease, i.e. commit to paying it or go bankrupt trying, even if the business shrinks and no longer needs or can afford the space. So you thought, great, we had a couple years of strong growth. Now you get to commit personally to five years of a huge expense. Congratulations.)

[Aurornis]

Where are you seeing commercial office space require 5 year personal guarantees from the founders? Terms like that would have everyone laughing as they hung up the phone around here.

[brudgers]

In the US, that sounds rather normal for normal triple-net commercial space for a normal new business run by people without established commercial relationships.

Typically, new businesses don’t get very much credit on favorable terms without established commercial relationships.

Dealing with failing or failed businesses is just not worth the hassle for most established businesses working in the established business market segment.

Silicon Valley is probably different because the business relationships are different. And of course month to month and short lease real estate are an entirely different market segment than triple-net.

[SoftTalker]

You need to look for hungrier landlords.

[brudgers]

Unless you want working plumbing and leaky roofs taken care of.

A hungry landlord is a landlord who is in dire financial straights.

Good landlords can afford to wait because they are using real-estate to park wealth, not as a means of putting food on the table. Think insurance company reserves and House of Windsor. It is a long play.