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Ontario's middle east | I struggle with your thought process. If we have a tough crop year yields will likely be down so hardly a huge windfall in revenue. If it is so good you can hardly stand it, there is the option to throw them a higher bonus if $25/ac is not sufficient. That is what guys are trying to establish with the flex rent. Spell out realistic expectations. Most importantly, if the LL was "left out of the riches during the good years" they are not the ones that need to have their reset button pushed. The fact of the matter remains, regardless of what guys are spending their money on, there are a lot of unsustainable cash rents out there that have the potential to bleed them more than 2 trophy wives. As much as everybody hates giving up ground, I think we need to contemplate that alternative. The LL aren't all stupid. Many of them experienced negative cash flows and witnessed the outcome of that on the neighbourhood's high fliers. There may be a lot more LLs willing to take a cut out there if they think they have to trade a sure thing for a pie in the sky tenant. I had a city guy pushing me for more last spring and I didn't think I could tell this guy anything, so he caught me at a bad moment and I told him to find another guy. I was shocked how put out he was that he was getting dumped. He demanded to know why. We were doing this by email BTW so I flipped him back his yield history, a link to my website with cash prices and a basic equation. He picks up the phone and says "ya that don't work". I said I know but "this does". He says I trust you, you do a good job and I don't want another guy, so he took the cut. I'm not saying it will be that easy and work every time but this guy, I thought, was a "have to have the highest price" tough nut, but it worked. My point being that some things need to be considered aside from, I cant let any ground go by. It's not a fun task with the potential for animosity amongst long term friends and neighbours but like Red Green said "we are all in this together" so take the man's prayer and keep your stick on the ice. | |
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Rent negotiations
