Commercial Real Estate: Tips for Taking on Tenant Challenges

Even in today’s strong marketplace there can be an array of issues creating tension between commercial property landlords and their tenants.

Recently, we saw retail giants with large commercial property footprints such as Target Canada fall, leaving their landlords in difficult positions.

Here are a few steps that can effectively smooth potential landlord-tenant issues.

Tenant Screening

In a recent episode of Shark Tank, Daymond John surprisingly pulled back on making an investment offer that seemed like a guaranteed success-business. It had nothing to do with match, credibility or performance. Instead, it was because the entrepreneur and founder were argumentative. When you are in business with someone, including being their landlord, you don’t want to be in a constant battle and financially draining relationship. Consider the tenants you’ll be working with as a part of the screening process too.


Target Canada’s move will leave at least 133 premises vacant. On average the leases still have about 12 years left, which can mean a catastrophic loss for the landlord. However, the retailer’s US-based headquarters had guaranteed these leases, saving retail property owners more headaches.

Relationship Building

Being proactive about building stronger relationships and loyalty with tenants can go a very long way to avoiding issues and having complying tenants. If landlords or property management firms have built strong relationships with business tenants and store employees, they’ll be less likely to create problems, and be far more forgiving. Simply sending birthday cards, offering new signage, sending a gift basket on their lease anniversary or stopping by to shop from them can do wonders.

Due Diligence

If issues between tenants arise or if tenants begin defaulting on their leases, consider your first steps to be due diligence. Invest time to find out the source of the issue and work with your tenant to create mutually benefiting solutions.

Professional Management

In addition to having real estate and business attorneys on retainer, having professional third party property management in place is another security for landlords. They can help minimize liability and maximize property performance.