Many small business owners get trapped by their landlords.  During the start up or high growth phase of any company, the owner tends to lease more space than they need. They get caught in the fantasy large offices and do big build-outs. The landlord knows what to feed an entrepreneur: their ego!

Unfortunately, when a business stops growing or shrinks, the large rent expense looms large on the profit and loss statement.  Since many business owners are required to personally guarantee their lease, they lose the flexibility to move to a smaller space when their business goes sideways. This has been especially true during the Great Recession where many companies were paying rental rates far above current market rates or their space was too large for their shrinking company.

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