Legal technicalities aside, the landlord has a good practical argument for retaining the whole deposit [until the end of the lease]. The increased deposit was intended to provide coverage for any damage the dog might do. The landlord may not know about any such damage until you move out, even though the dog is long gone.

The above quote is from a post on Inman News in a Q&A column that I thought was worth sharing here (click the link to see the rest of the article).

Not only is the post a good primer on the ins-and-outs of security deposits, but also on the general nature of leases and how changes to an existing lease should be handled. This is important information to understand for both landlords and tenants. Basically, lease terms can’t just be changed at the whim of one party (duh!) — while that seems like it should be taken for granted, you would be surprised how often we have to explain that in the normal  course of business.

In fact, in NYC the zoning regulations are so convoluted that “In a recent case, a judge said the word “development,” which appears at least 2,500 times in the [zoning] resolution, did not mean what the city said.” (source: New York Times article — we’ll see more about that article in just a minute)

The Planning Commissioner for NYC, Amanda Burden, is attempting to make the zoning regulations a little more accessible to the general public by issuing a new city handbook with plain explanations and cartoon drawings that illustrate what particular zoning designations look like and what they mean.  Check out the coverage in the New York Times about what she has been doing to bridge that gap.

While this may not be the right approach for every locality, the idea is one that every local government should take to heart:  Start building tools that puts control of the government back into the hands of the people.  Sure, we elect officials to represent us and we should not be ruled by mob mentality (see: California), but the people also need to be able to understand what is being done — especially when we are expected to interpret these rules and abide by them.

I have seen far too many business and property owners try to follow the rules that have been laid out, only to find a health inspector or building inspector come in with a totally different understanding and cost the owner thousands of dollars in hard cost and lost business because the rules were not clear enough.

What do you think, Richmond? Have you had any issues with the local zoning regulations (city or county)? What would you suggest could be done to make the rules more clear?

The Museum District Association had originally ruled to oppose the redevelopment based on the original plans, but Friday they sent out a press release announcing the reversal of that position.  The gist of the situation can be summed up from this one paragraph in the press release:

The Board voted 13-1 in November to oppose the original SUP and subsequently provided the applicant with detailed requests for further changes to make it more amenable to the neighborhood. The applicant responded by altering the SUP to remove vehicular ingress/egress on Nansemond Street as well as reduce the number of available uses of the property to 10 uses. The applicant also agreed to limit the usable floor space of any one tenant to no more than 25,000 square feet, ensuring there would be multiple tenants in the building and ruling out a single, larger “big box” tenant.

The whole press release can be read here on the MDA’s website (right now it’s at the top, but it will shift down the page as new releases are issued).

What do you think? Are you satisfied with the MDA’s ruling, or are the changes in the plan not enough for you? In that case, what changes would be enough to get your support for the development?

Retail Traffic is a great resource for information on the retail real estate market and I always enjoy seeing a new issue come out.  If you don’t want to miss anything, I would suggest you watch it closely too.  Of course, if I see anything particularly interesting, I will be sure to pass it along here.  For example…..

Their “Retail Real Estate’s 2010 in Review” is a comprehensive review of the biggest stories in retail real estate over the course of the past year.

And even more important, “What Will 2011 Bring?” (which links to a few other very informative pieces)

However, the decision by an owner to sell their own business may be one of the largest missteps of their career. Why? Selling a business is much more complicated, involved and typically much more important than selling a house. Yet, imagine that you wanted to sell your home yourself without using a Realtor. You may know your house better than anyone, so it may seem a logical decision. But do you know what it’s really worth in today’s market? Do you know how to market it to as many qualified potential buyers as possible? Should you get an offer, do you have the experience to negotiate on your own behalf to get the most amount of money possible? Once agreed on a price, can you assist the buyer to assure proper financing is attained and keep the deal moving forward? Finally, even if you answered yes to any of these questions, can you afford the time it would take to complete this process? How much would this time really cost in terms of your productivity? Well, just like a house, you can ask each of these questions about your business and whether taking the sale into your own hands would really be to your benefit.

Fortunately for you, there is a better and easier way to sell a business that will typically result in a higher sale price, a faster close and require much less stress and time on your part. Chances are, there is a qualified business intermediary or ‘business broker’ in your town who, like a real estate agent, can properly price, list, market and sell your business. Selling a company confidentially is a complex and intricate process. A professional business intermediary will be able to handle every aspect of the sale cycle and keep the transaction moving forward through each step.

Services that a business intermediary will perform on your behalf will start with an evaluation of the business and an appropriate, professionally determined sale price for the company. A business intermediary will base the price on several pieces of information including the financial health of the business, demand in the marketplace for businesses like yours, condition of the assets, depth & strength of management, customer diversity, growth potential, and current industry sales trends. You may have heard that it’s as simple as a multiple of profits/EBITDA, but it’s really far more complex than a simple multiple to get the most appropriate (and often most lucrative) price and best terms (contrary to what you may hear in Wall Street, very few businesses sell for all cash).

Once an acceptable sale price or range is determined, the business intermediary will create a Confidential Business Summary about your business. Depending on your industry, this may include an Executive Summary of the business, management organization chart/personnel descriptions, facility specifications, sample marketing pieces and a summarized financial statement along with tax returns and/or other financial documents to verify the numbers. When completed, this will be the primary document to introduce the business to prospective buyers after they have signed a Non-Disclosure or Confidentiality Agreement.

This brings us to another great aspect of a business intermediary: Confidentiality. This is extremely important. Every time your business intermediary locates a potential qualified buyer, before disclosing any specifics about your business (including its name), they will have the prospective buyer sign a Non-Disclosure or Confidentiality Agreement. The document will cover many points including restricting the buyer from discussing with anyone that your business is for sale, and not allowing them to speak to or solicit your employees. This document protects you and your business.

Now that the business has been evaluated, a sale price determined and a Confidential Business Review Package created, your business intermediary will begin marketing the business. Finding prospective buyers, especially qualified ones, is one of the largest challenges to selling any company. Business Intermediaries will use a variety of methods to find qualified buyers. Methods that they will use depend largely on the industry your company is in, the size of the business and the geographic area that the business is located in. Some marketing channels may include working with buyers that the intermediary already has a relationship with who are looking for a business like yours; utilizing online resources made specifically for intermediaries to advertise the company to buyers looking for a business in your industry and price range; and using direct marketing methods to target synergistic or strategic buyers or other existing businesses that your company may fit in with. These are just a few broad avenues for marketing and successful intermediaries have their own proprietary ways of successfully finding qualified buyers, all of which are conducted discreetly and confidentially.

Once a serious, qualified buyer is found, your business intermediary will be there to work with you on negotiating the final purchase price and terms. These are often put into a Letter of Intent that will serve as an outline to the final Purchase Agreement. Ideally, the intermediary can generate multiple potential buyers and create real or perceived competition for the business. This tactic can often result in improved price and terms. Business intermediaries will often assist the buyer in finding financing sources and may have your business pre-qualified with an SBA lender if appropriate. An entire article could be written on financing alone, but suffice to say that an intermediary’s relationships and ability to work with various financing sources (banks, equity firms, private lenders/investors, etc.) is among their greatest assets to you and will open many doors to buyers in need of funding to complete the transaction. Finally, the intermediary will be with you through closing and will have helped to put together a plan between you and the buyer to ensure a smooth, successful transition and continuation of the business.

So for all the expertise, time saved and top sale price and terms attained, what does it cost to sell your business through an intermediary? Typically, business intermediaries are paid a fee which is typically a percentage of the sale price. Many intermediaries will also ask for a small fee upfront. This helps partially offset their costs in business valuation, marketing and advertising while also showing your seriousness and commitment to move forward with a transaction. The upfront fee may or may not be credited to the final fee upon the sale. In most cases, the sale price that a business intermediary can negotiate for your business will be higher than what a sale-by-owner transaction would bring, even after taking their fee into account; this is due to their knowledge, expertise and by maximizing leverage in the negotiation process. [By the way, as of 12/14/10 (and the foreseeable future), we have never charged an upfront fee here at Bandazian & Holden! - NVH]

For many small business owners, the sale of their business is one of their most critical life events; that may only happen once in their lifetime. Having the assistance of a focused professional to manage and lead you through the process all the way to the closing table can make a huge difference in insuring the outcome is consistent with your goals. We hope that you will consider meeting with a business intermediary to discuss your specific company and goals. A good and reputable intermediary will never charge you to discuss your options. We hope that you have found this article helpful and informative. The Carolinas-Virginia Business Brokers Association and its members are dedicated to serving our industry with the utmost integrity, loyalty and customer service.

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This article was prepared by the CVBBA for the purpose of assisting clients and their advisors in understanding the appropriate role and benefits of utilizing a business intermediary to facilitate the successful ownership transition of a small business. The reader has permission to copy and distribute as desired. For further information please go to www.cvbba.com.

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Currently, only real estate professionals that engage in property management services have to use 1099 forms to report any service provider that they pay more than $600 in a given tax year.

The changes will be enacted over the next two years as follows (details from the NAR Issue Brief released recently — can be found online here or hosted on my site here):

2011 Rule: ALL persons who receive rental payments must provide Form 1099. This affects ALL owners (both individuals and businesses) of rental properties, both residential and commercial. Thus, “mom and pop” investors and those who invest in real estate for their personal portfolios are subject to the new reporting requirement. Only aggregate annual payments of $600 or more for services (but not goods) must be reported.
2012 Rule: All businesses, including real estate businesses, self-employed individuals and independent contractors will be required to make a 1099 report of any aggregate annual payment of $600 or more to any person from whom they acquired goods and services.

Please keep in mind that I am not an accountant, so before you act on any of this information (or panic. or dismiss.) please consult with your accounting/tax professional.  But when I saw this come across my desk, I thought it was important that you are aware of these new rules!

(*Warning! Sales pitch!*) And, by the way, here at Bandazian & Holden, we have dealt with these reporting requirements from when they were first enacted for real estate professionals in the property management field, and we are accustomed to handling the necessary paperwork for our clients.  If you don’t feel like dealing with it on your own, let me know and come on board with us. (*End of warning. Enjoy your day!*)

Richmondmom.com is one of Richmond’s premier family resources online, and in the spirit of Thanksgiving and the holiday season, they are giving away gift cards through GiveRichmond.org to support charitable organizations.  Click here to go to see the full details on the contest.

There is a nomination process running through November 30, 2010 (this Tuesday!) where anyone can weigh in and submit their favorite Richmond charity. Give a great reason and your pet project may just win! Tell your friends and tell the organization to rally support and get votes.  The voting will run through most of December.

And the best thing about this is that everyone wins, no matter which organization actually gets the money. All of the nominees will be great non-profits that are helping make Richmond a better place to live and work.

Read through this article at Agent Genius to see what’s changed:  “Is sexual orientation discrimination in housing legal? Maybe.“  It’s great news!

According to the NAR, the Code of Ethics Article 10 has been amended:
Article 10: Equal Rights Amendment Passes:
The NAR Delegate Body approved an amendment to Article 10 of the Code of Ethics to prohibit discrimination on the basis of sexual orientation. In a roll-call vote, more than 93 percent of the Delegate Body voted in favor of the amendment. The Delegate Body decision confirms a vote by the Board of Directors in May.

As a personal note, AG strongly supports and applauds the measure taken that Realtors’ ethics supersede federal law so that no matter if it is legal or not locally, discrimination based on sexual orientation will not be tolerated from Realtors, a measure taken by Realtors.

Huzzah for the Realtor community for standing up for what’s right and making an amendment to the Code of Ethics to declare sexual orientation discrimination officially unacceptable!

Today is a day when I’m even more proud than usual to call myself a Realtor.

Maybe Richmond will get one of these?

The one that they are most confident in is — pies.  Not only sweet pies, but savory ones, too.  From what the article says, the pie shop is the new cupcake shop.  I guess it makes for a good headline (and no denying that pies are tasty!), but there are other predictions they make that I’ve already seen happening locally:

• The new mom and pop. Self-financed restaurants built on limited budgets are growing in number. “This is an economic decision,” he said. “There are a lot of people out there who still want to open up restaurants, and it’s a good opportunity to look at real estate in a down economy.” The restaurants are typically small and the owners are extremely involved. Some examples are eVe in Berkeley, Calif., and Sons & Daughters in San Francisco.

•  One-ingredient restaurants. “Restaurateurs are taking one ingredient and building full restaurants around them,” Freeman said. Following on the several-year trend of gourmet burgers, the trend is extending to grilled cheese sandwiches, hot dogs and sliders. “We’re predicting perhaps a peanut butter restaurant next or a big biscuit restaurant,” he said.