Reducing Real Estate Expenses by “Restructuring” a Commercial Lease

David Marino | HM Blog
January 21, 2021

When the business community begins to open back up this year, many business owners and executive teams are going to look around at all of their excess space remaining from reductions in force and team members working from home post-Covid and wonder what to do about it. With the business community considering how to rebuild their organizations, there will be anemic demand for new office space. Those office tenants already planning to come back are generally thinking they need 50%-80% of their pre-Covid footprint. As tenants’ leases expire, the commercial real estate market is experiencing “negative net absorption” as tenants with office leases expiring downsize and give space back in droves. At the same time, both sublease inventory and space given back to landlords from tenant defaults is flooding the market. This combination of weak demand and spiking supply is causing commercial rents to crash, and a spiking in concessions such as free rent, moving allowances, parking concessions and shorter lease terms, creating the strongest tenants’ market since the 2000 Tech Wreck.

The War for Talent Rages On

Mike Paleo | HM Blog
December 21, 2020

As the pandemic rages on, so does the war for talent. The hard truth is that many businesses will not survive the pandemic. However, for the survivors, coming out strong may mean leveraging their current condition. While everyone is talking about furloughs and layoffs, a number of savvy CEOs are quietly hunting for talent.   At the end of September, the Bureau of Labor Statistics reported 6.4 million job openings. Smart CEOs realize the extraordinary value created by the very top tier performers. Ordinarily these high-value-add professionals are hard to find and even harder to recruit. But the pandemic created massive turmoil in the employment sector, and a few of these superstar employees got swept up in the reductions and suddenly find themselves looking for work.