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We have a commercial building with four units. One “problem” tenant has been consistantly late and/or behind with his rent payments. He has a book store with “rare” or unusual books. He doesn’t draw much of a crowd off the street, but he does do OK with internet sales.
We gave him a three day notice to “Pay or Quit”. He said he has a 2002 vehicle, free and clear, that he has for sale. Worth about what he owes to us, plus a little more. He says that he’ll have the money once the car sells.
We’re thinking of having him just sign over the vehicle (gift it to us ?) and that would go towards back rent and two or so months future rent. He will also move his business to the vacant second story unit for a lot less rent, freeing up the prized main floor space with lots of windows. The next door business, Antique store, really needs to expand and has offered to take it once it becomes available. We’ll start a brand new lease with him on that upper unit.
Question:
Since there is no loan on this vehicle and we know what it’s value is, we’re open to taking it in trade (I need something with better fuel mileage anyway).
How would we work this ? I’d like to put it into a Personal Property Trust with the beneficial shares held in an LLC.
Legally, does this create any issues concerning him being a “former” tenant that paid up with a trade ? (Former tenant for the old downstairs unit).
The building itself will be demolished in about a year to a year and a half. The entire downtown area has been approved for greater building heights and “mixed use” (Commercial; Office; and Residential). State Grants have been approved and put in place to assist with this “rebuilding” of the main street; Low interest rate loans and only pay back 80% of the loan.
What are some thoughts ?
B
You could buy the vehicle from him (the PPT would be the buyer) and he could immediately pay you the cash for the back rent and two months future rent. Have someone you know be the trustee for the PPT which shows up on the deed. Better yet, have him deed the vehicle to a PPT then buy the beneficial interest.
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