business/landlord issue

gizabeer

Hi All,

Query here and could do with some advice.I operate a business in Dublin. I have a good relationship with my landlord and property manager. I am a good tenant-compliant and I pay rent/insurance/rates and maintenance charge on time all the time.I have been operating this business for over a year-its going fine-i am by no means making a fortune but i earn a wage and cover all costs. In my business a year in that is not too bad. I am actively trying to grow the business and have put a decent chunk of money into the start up. I would have no plans to recoup that investment for a while as I need to keep reinvesting in the business.
My issue is that-without much notice,in writing via email (3 days)-the property manager has told me that a pop up business that directly competes with mine-will be operating literally on my doorstep once a week,every week on my busiest day. I can only operate 5 days a week and I also loose bank holidays too-so obviously this is not good news for me. This will have severe consequences for my business. It is still in its infancy and this pop up will destroy my trade on that day-from speaking to the previous occupant I could be looking at at 60%+ drop on that day.I have large overheads and I cant compete with it.I am all for fair competition,but i don't believe this falls under that umbrella.I have 4-5 outlets very close to my property that I already compete with-I don't expect my landlord to be one of them.
My lease/property management contract does not give much guidance on this. Basically I pay my fee and it seems the management company can do/not do whatever they like. My solicitor could not give me much direction either.
I have invested everything in this business and I don't have the capacity to prop it up for a few months while this pop ups novelty wears off. Loosing my busiest day every week will send me under in jig time.
What i want to know is-
1-Is there anything i can do to stop this pop up?
2-If it is the case that it goes ahead and it does affect my business(limited company) so badly that I cannot continue what recourse-if any-do i have? Is it not within the landlords best interest to ensure they don't contribute to their tenants demise.
Any advice would be much appreciated.

Nuttzz

really depends on the type of business, hard to say why a pop up shop should instantly become more successful than your shop.

You cant really prevent your landlord doing what he wants with his own property and even if he didnt own it, you couldnt stop someone else for doing the same.

You could have a word with him and explain how you feel this would hurt your business and see if he is willing to do anything for you, but hes under no obligation

How long is your lease for and are there any break clauses in it?

gizabeer

Its a food business. This pop up isnt just one-its about 8 traders all offering food. I operated in these pop ups for about 8 years and I know the affect they can have on a business. I know the property and premises is the landlords and he can do what he will with it but I also know that the affect of this will be immediate.
I have a break clause at 3 years-6 months written notice to be given.
When I took the lease I stipulated that the pop ups,which were in operation at the time,would have to go if they wanted me to take the lease- it was agreed and now a year later they are coming back!
I spoke to the previous tenant today and he informed me the reason he left was because he did no business on the days the pop up operated.
I run a good business,offer a lot of variety and look after my customers,but I cant compete with a fiver lunch. Not on what it costs me to operate.

davindub

gizabeer wrote: »

Its a food business. This pop up isnt just one-its about 8 traders all offering food. I operated in these pop ups for about 8 years and I know the affect they can have on a business. I know the property and premises is the landlords and he can do what he will with it but I also know that the affect of this will be immediate.
I have a break clause at 3 years-6 months written notice to be given.
When I took the lease I stipulated that the pop ups,which were in operation at the time,would have to go if they wanted me to take the lease- it was agreed and now a year later they are coming back!
I spoke to the previous tenant today and he informed me the reason he left was because he did no business on the days the pop up operated.
I run a good business,offer a lot of variety and look after my customers,but I cant compete with a fiver lunch. Not on what it costs me to operate.

"When I took the lease I stipulated that the pop ups,which were in operation at the time,would have to go if they wanted me to take the lease- it was agreed and now a year later they are coming back!"

Did you tell your solicitor about this?

Cianos

Is there a chance that the pop ups will bring more trade to the area that you could benefit from the rest of the week?

mrawkward

if you do not have the restrictive trade agreement in writing, you face an uphill and expensive battle to deal with the reality that " a verbal agreement is not worth the paper it is written on". Your case might be eased by having 3rd party witnesses to the fact but the legal costs are likely to be substantial, not a risk you can afford to take, I assume. You probably have two choices, walk and let him sue you..unlikely or just dont pay the rent or even an arbitrarily low one and let him make the running... then make your call, settle or run. If you are a limited company the old addage that "you can't get feathers from a frog" may be your friend.
If it is not in writing, you are paying the price of your lack of attention to the detail of the original deal. The way of business, I fear.

the_syco

gizabeer wrote: »

I have been operating this business for over a year

Was this pop-up there last year?

gizabeer wrote: »

from speaking to the previous occupant I could be looking at at 60%+ drop on that day

Did you find out about this pop-up from the previous occupant before or after you signed the lease?

mrawkward

the_syco wrote: »

Was this pop-up there last year?


Did you find out about this pop-up from the previous occupant before or after you signed the lease?

Who cares!! The actual situation now is what needs to be dealt with. The last thing needed is making legal or "he says, she says" arguments.. pick a strategy and run with it.
I am a commercial rental property owner and my rules are very simple indeed, if the mark is good for the money..I nail him...if not, I just lock 'em out. My lawyers tell me I could be injuncted/sued, my view is, if he can afford the legal costs, he can afford to pay the rent! Has never gone legal to date.

I would write to the landlord and say to him that in the case he follows through with the pop ups, you will be forced out of business and have to close down. Make the case that the 60% you will lose on that day is what amounts to your salary per week so its just not possible for you to absorb that.
Better yet get a meeting with him and show the numbers.

If he doesn't see your side, looks like theres not a lot you can do. Ask them can you exit the lease early seems your only option after that. If you just close down they can most likely pursue you for the lease if they are ruthless enough.

pedroeibar1

Methinks this is a case where the solicitor was consulted for the first time recently, not when the lease was entered into. OP is on a hiding to nothing unless his 'no similar business' claim is in writing. Time to look for new premises.