an interesting business contract. (lease, receptions, home)

[Submariner]

I have an old commercial building in a downtown block of a nearby town, this building has a storefront space. When we bought this building we had put a church into this storefront, that church made an effort to install a range with an exhaust hood to make it into a licensed kitchen. But after three years they were never able to raise enough money to install the exhaust hood. the church folded and went away, leaving us with an empty venue.

Today we met with a man who wants to be an event organizer. He wants to use this storefront space, and he is promising to install an exhaust hood & range and make it a licensed kitchen.

If he has the capital burning a hole in his pocket, I figure we should just let him do it, and if/when he fails and goes away, he will have increased the value of my building by making it into a licensed kitchen, for me.

Along with paying me monthly for a lease, he will also be investing in a physical improvement of my building.

hmm.

[roadrat]

Originally Posted by Submariner

I have an old commercial building in a downtown block of a nearby town, this building has a storefront space. When we bought this building we had put a church into this storefront, that church made an effort to install a range with an exhaust hood to make it into a licensed kitchen. But after three years they were never able to raise enough money to install the exhaust hood. the church folded and went away, leaving us with an empty venue.

Today we met with a man who wants to be an event organizer. He wants to use this storefront space, and he is promising to install an exhaust hood & range and make it a licensed kitchen.

If he has the capital burning a hole in his pocket, I figure we should just let him do it, and if/when he fails and goes away, he will have increased the value of my building by making it into a licensed kitchen, for me.

Along with paying me monthly for a lease, he will also be investing in a physical improvement of my building.

hmm.

Sounds like a good deal, Just make sure the lease says that all improvements must remain after.

[G1..]

Originally Posted by Submariner

I have an old commercial building in a downtown block of a nearby town, this building has a storefront space. When we bought this building we had put a church into this storefront, that church made an effort to install a range with an exhaust hood to make it into a licensed kitchen. But after three years they were never able to raise enough money to install the exhaust hood. the church folded and went away, leaving us with an empty venue.

Today we met with a man who wants to be an event organizer. He wants to use this storefront space, and he is promising to install an exhaust hood & range and make it a licensed kitchen.

If he has the capital burning a hole in his pocket, I figure we should just let him do it, and if/when he fails and goes away, he will have increased the value of my building by making it into a licensed kitchen, for me.

Along with paying me monthly for a lease, he will also be investing in a physical improvement of my building.

hmm.

By adding the exhaust hood are you restricting your option for tenants if as with the first Tennant it doesn't work and they walk? It could cost money to remove the hood.

[Submariner]

Originally Posted by G1..

By adding the exhaust hood are you restricting your option for tenants if as with the first Tennant it doesn't work and they walk? It could cost money to remove the hood.

The space that he wants to use, is currently occupied by a church on Sunday mornings and a charity Wabanaki health clinic once a month. Otherwise, it is a venue mostly birthday parties,
baby showers, gender reveal parties, weddings, and receptions. We have also done a political caucus.

This gentleman originally came to me asking to rent my venue for an open mic comedy show. Then after I gave him a tour, he offered to organize events. He wants to setup an office for himself in a storage room, and make a few improvements, and he will take over scheduling events [leaving the church and health clinic untouched].

I think that once improvements are made to become a licensed kitchen, we might not touch anything. My wife likes the idea of renting it as a 'licensed kitchen'.

[OutdoorLover]

Of course you know the space, the neighborhood, and what would fit more than anyone here can. It does seem like an interesting coincidence though that first a tenant and then a prospective tenant want to install a commercial range and hood.

Regarding retention of the improvements, the hood I can see being considered as part of the building. But the range - a freestanding appliance, seems like more of a gray area, does it not? At some level of course, it's what you can get this prospective tenant to agree to, but what is most reasonable seems like a good place to start. I just don't have enough experience in this area to be confident in what's reasonable...

[Maine Writer]

Originally Posted by Submariner

I think that once improvements are made to become a licensed kitchen, we might not touch anything. My wife likes the idea of renting it as a 'licensed kitchen'.

Great idea! Offering it as an incubator for people who can't get a commercial license in their home but want to sell foods that can't be processed in a home kitchen might bring in a lot of business. I'd have rented such a space for a day a week if I'd had the opportunity before building my commercial space. Seems like a good space for cooking lessons as well.