Sanford Nelson sounds like bad news for Eastern Market

[DeLemur]

It does not make sense,they had to close for the day and reported that they lost $3000.

They had no food or employee costs for the closed day so they lost $3000 in profit.

So one days profit pays the anticipated rise in monthly rent.

Or on a 30 day month 90,000 in profit.

If thier dish sink was leaking for a long time and they choose not to repair the leak as it damaged the floor,it should be on them to pay for fixing the damages.

It does not matter if the building is 500 years old if you were negligent in fixing a water leak that destroyed or damaged a floor you are responsible weather you move or not.

The health department must be different up there,here you cannot have a permeable floor for sanitation reasons in the food or dish areas,a restaurant dish sink leaking enough through a broken flooring barrier long enough to soften the supporting floor has to have some nasty funk going on there.

It is a biased article because it does not state the terms of the lease,most restaurant leases are triple net,which means that the buisness owner is responsible for all repairs and taxes.

triple net lease

A lease in which the lessee pays rent to the lessor, as well as all taxes, insurance, and maintenance expenses that arise from the use of the property.

From Detroit’s bankruptcy and forward every time a property sells,odds are it will never sell at that price again,so anybody buying property at the increased price will adjust the lease terms accordingly in order to pay the note.

As cheap as buildings were in Detroit any buisness making 90,000 per month in profit that does not purchase a building is nuts.

Include a copy of the lease or otherwise it is just he said she said and of no value.


But from the link provided

Per the lease they agreed to in 2007, which remains in effect until 2021, these repairs are their responsibility.


To me anyways they were more so looking to break the lease in order to move on to this,the floor was just the excuse.

In 2013, Hall started a packaged soup company that is poised to expand its distribution this summer to 60 Whole Foods locations around the Midwest.

If you sign a lease knowing full well that you are required to perform any maintenance required it would be on you to shut down and do the repairs and not the landlord.

In this case the landlord has offered to front the $50,000 on a payment plan added to the monthly lease,he can say it is all on you either you fix it as you agreed to in the lease or your lease is terminated for failure to hold up to your end of the contract and will be sued for damages.

It would seem even though the new or old landlord is not responsible for the damages,the new landlord in the interest of maintaining his new investment is going the extra mile to keep the tenant by loaning them the $50,000.

But the new landlord is the bad guy?

That's $3,000 in lost revenue - not profit. That's a big difference and makes me not want to read the rest of your argument.

The Nelson's have a bad reputation around town. Something tells me its for a reason. This doesn't look like Detroit "progress" to me.

[Richard]

That's $3,000 in lost revenue - not profit. That's a big difference and makes me not want to read the rest of your argument.

The Nelson's have a bad reputation around town. Something tells me its for a reason. This doesn't look like Detroit "progress" to me.

Maybe if you read the rest you would understand basic buisness.

He said the $3000 loss devastated him,he is claiming the $3000 as lost revenue.

You shut the doors for the day,product stays in the cooler you did not sell it or incorporate it into a meal.

Shut the doors for the day and the only costs that carry forward are your fixed costs.Does it cost him $3000 a day in fixed costs?

I own,service,consult and build restaurants and have for many years,nobody shuts down for the day for contractor estimates.

His lease stated that the tenant was responsible for building maintenance,the previous landlord did not check up and make sure that the space was being properly maintained and just offered cheap rents.

The deal was tenant maintained the space,that is in a legal document,the tenant choose to not maintain the space and not fix a leak to prevent further damage,so the previous landlords complacency trickled down to the tenant.

The difference in the end is the landlord did not care,he got paid for the sale and why should he care because it was on the tenant in the first place.

In reading the comments online and here there is a pretty common theme.

People seem to want the city to change,fix the roads,fix the street lights,stop the crime etc.

We know it all needs to be paid for but we just do not want to have all of these rich people buying our buildings and improve it them in order to increase the tax base.

The simple solution would have been for the restaurant owner to just buy the property himself.

It was like the other interview,the store owner reported that she was not looking to make a profit,just provide cheap space for others.

That is fine,go buy a building and have at it,why expect a property owner to give you something cheap so you can be the nice guy at somebody else’s expense?

Its an old building that has had millions in deferred maintenance for many years,fix it all like brand new so I can have a cheap space.

Name one city in the country that offers commercial space like that for $350 per month.

[DeLemur]

Maybe if you read the rest you would understand basic buisness.

He said the $3000 loss devastated him,he is claiming the $3000 as lost revenue.

You shut the doors for the day,product stays in the cooler you did not sell it or incorporate it into a meal.

Shut the doors for the day and the only costs that carry forward are your fixed costs.Does it cost him $3000 a day in fixed costs?

I own,service,consult and build restaurants and have for many years,nobody shuts down for the day for contractor estimates.

His lease stated that the tenant was responsible for building maintenance,the previous landlord did not check up and make sure that the space was being properly maintained and just offered cheap rents.

The deal was tenant maintained the space,that is in a legal document,the tenant choose to not maintain the space and not fix a leak to prevent further damage,so the previous landlords complacency trickled down to the tenant.

The difference in the end is the landlord did not care,he got paid for the sale and why should he care because it was on the tenant in the first place.

In reading the comments online and here there is a pretty common theme.

People seem to want the city to change,fix the roads,fix the street lights,stop the crime etc.

We know it all needs to be paid for but we just do not want to have all of these rich people buying our buildings and improve it them in order to increase the tax base.

The simple solution would have been for the restaurant owner to just buy the property himself.

It was like the other interview,the store owner reported that she was not looking to make a profit,just provide cheap space for others.

That is fine,go buy a building and have at it,why expect a property owner to give you something cheap so you can be the nice guy at somebody else’s expense?

Its an old building that has had millions in deferred maintenance for many years,fix it all like brand new so I can have a cheap space.

Name one city in the country that offers commercial space like that for $350 per month.

Ok sure, losing one day shouldn't kill his business, but it was revenue not profit. His rent is pretty low at 1700 a month. But how the hell is he supposed to jump to 6000 a month or 3700? No one can double or triple their rent payment and expect that to be rational, kind or a deal. It kills the business. And this is a well liked, quality business.

[Honky Tonk]

Ok sure, losing one day shouldn't kill his business, but it was revenue not profit. His rent is pretty low at 1700 a month. But how the hell is he supposed to jump to 6000 a month or 3700? No one can double or triple their rent payment and expect that to be rational, kind or a deal. It kills the business. And this is a well liked, quality business.

I haven't seen or read the contract, but if Hall is on the hook for the $50k, he owes it whether or not he's operating from the building in Eastern Mark-up or somewhere else. I got the impression from the article the increase was until the loan was paid off. The only way out of this for Hall is to file bankruptcy. If he's got a $3k daily cash flow, he's not doing too badly.

[archfan]

I haven't seen or read the contract, but if Hall is on the hook for the $50k, he owes it whether or not he's operating from the building in Eastern Mark-up or somewhere else. I got the impression from the article the increase was until the loan was paid off. The only way out of this for Hall is to file bankruptcy. If he's got a $3k daily cash flow, he's not doing too badly.

We haven't seen the lease, but we know it was written in 2007. In 2007, landlords were writing sweetheart leases so tenants didn't abandon their building. If I were a restaurant negotiating in 2007, I would have made it the owner's responsibility to do maintenance, and probably would have gotten it.

That's backed up by the new owner blaming the bad floor on the tenant - that would be the only way they would owe, if the owner was on the hook for maintenance. Also, when the new owner took over, he promised to do deferred maintenance; why would he promise that if he wasn't responsible for the maintenance?

We only have the new owner's word that the repair will cost $50K. I don't know if $50K is reasonable to repair a floor that the building inspector thinks is okay. But, it does seem like a big enough bill to threaten collection/court if they don't sign the new, higher lease.

[Honky Tonk]

We haven't seen the lease, but we know it was written in 2007. In 2007, landlords were writing sweetheart leases so tenants didn't abandon their building. If I were a restaurant negotiating in 2007, I would have made it the owner's responsibility to do maintenance, and probably would have gotten it.

That's backed up by the new owner blaming the bad floor on the tenant - that would be the only way they would owe, if the owner was on the hook for maintenance. Also, when the new owner took over, he promised to do deferred maintenance; why would he promise that if he wasn't responsible for the maintenance?

We only have the new owner's word that the repair will cost $50K. I don't know if $50K is reasonable to repair a floor that the building inspector thinks is okay. But, it does seem like a big enough bill to threaten collection/court if they don't sign the new, higher lease.

My interpretation from reading the story is the increase is a "payment plan" to pay off the $50k debt, there's no mention of it being a permanent increase. The article is poorly written and omits pertinent facts. Everyone wants to make Detroit great again as long as they're filling their pockets. When the tax abatements run out, the prices go up, and it's time to pay, they want to take their ball and go home.