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Kenny202

Renting / Sub letting a selling space in Thailand

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2 minutes ago, kingofthemountain said:

What's happen if your wife stop to pay the 1500 to the middle lady?

i mean if she has 0 legal rights on it, can she come with the police?

If i was your wife i should try to deal directly with the 'real'' owner

the middle lady seems to be an useless scrounger (There is an infinite stock of them here)

She as the principal tenant has the right to sublet to us. There is nothing illegal going on. The last thing you want here is to come to the attention of the police whether you are right or wrong. Most times it doesn't matter. It's who is offering the best kick back. It's a petty thing anyway. I certainly would be interested in involving police or courts etc. In any case she hasn't done anything wrong. She is just trying to get payment for something valueless, and she thinks she is quite within her rights to do so no matter how unreasonable it is. Its up to us whether we want to accept it or not. This sort of arrangement occurs every day here and back home too. It's just that usually you can see you are getting something for your money. In this case I don't see it. No brainer for me to know we would be better off in every respect to move rather than pay that much money. 

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11 minutes ago, Kenny202 said:

Who do you think will be paying the 35k? lol, with little chance of recovering it. So it is a concern for me. 35k isn't chump change, not for me anyway.

 

I know a lot of things here don't make sense to us and sometimes you have to bite the bullet but this isn't one of those times. The economy here shagged and not looking like it will improve. Covid everything uncertain. No Thai person would pay 35k for the privelege of nothing more than to be able to rent, when there are similar areas down the road where they can't find a tenant to rent with NO cost. If it was a busy market area, hard to get into yes. It would be slightly inconvenient for her to move but not really that big a deal. Its about value. For maybe 10k I would do it just to avoid the inconvenience and possible slight loss of trade. But 20k + doesn't make sense

Well you answer yourself to your own question

 

it should be a very stupid thing from your part to pay 35000 for nothing

we are not talking about 350 bahts here, it's not a huge amount, but it's

3 months of a random Thai salary, so from a Thai point of view it's big money.

 

Honestly don't let you embark yourself in inacurate debates about the right or not

of the owners, as i said the only thing is '' the money generated by the business can pay it or not?

if not, don't do it, usually Thai loves to take risks with farang money, or they consider for some reasons our money is less important than their, and they consider something is cheap untill they have to pay for it.

Again let your wife takes the decision with HER money,

 

it's her business. If she really wants to do it she can still ask a loan to the bank

actually there is a special Covid goverment program for very cheap and easy loans

for small businesses

 

Edited by kingofthemountain

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On 9/1/2020 at 1:07 PM, Kenny202 said:

How they can rent a footpath area which may not even be theirs I don't know but seems to be the norm in Thailand.

You are not renting the public pavement, you are having a permission to block the front of someone's property, and you pay a fee for that permission. The same happens with beach fronts, where for example a beach massage platform pays rent, or commission per customer, to the land owner behind, even the actual beach belongs to the Marine Department, which actually can ask the business to be removed, or set restrictions of how much of public walkway can be blocked. The latter often happens for beach restaurants and sunbed rent outs. There has also been numerous cases a few years ago in Bangkok about removal of businesses that blocked public pavements.

 

On 9/1/2020 at 1:07 PM, Kenny202 said:

The women keeps telling my wife this sort of thing is normal in Thailand and I could understand if we were getting anything for our money, even good will or ongoing business, or a guarantee we can stay there for 5 years etc but as far as I can see, the current tenant was stupid to give the last tenants 30k to take over the area, and she in turn wants us to be stupid.

Yes, it is "normal", and also normal that key money moves on to the next tenant. If it was a bar or restaurant, the key money could easily be in hundred thousands, or millions, for mainly a structure on rented land; a structure that would be mostly worthless if the rental is given up.

 

You cannot make any agreement of rent longer than three years, as it otherwise need to be registered on a land deed and tax paid; however you cannot register a lease on a public pavement. But if the covered area is private, you can register a longer lease for up to 30 years, or make a written rental contract for up to three years.

 

On 9/1/2020 at 1:07 PM, Kenny202 said:

SO... what I am really trying to ascertain is if anyone has had the same experience and knows if this sort of thing is normal or not? I have heard the expression "key money" used. Not sure if that is what this is. There is some benefit to us being that if we rent directly off the owner our rent will be cheaper long term and we will recoup the 30k back in about a year. Also she has to consider the possible loss of business she will have if she moves, temporary or otherwise. Any advice welcome

"Key money" is normal in Thailand, and lot's of business work with small commission here and there, including renting from a middleman/woman. Taking over the rental agreement could mean a little lower rent – the tenant would probably make a small profit by renting the space out for a higher rent that is paid to the landlord/owner – however, if you renegotiate the agreement, then the landlord might increase the rent to the level you pay now, or even higher, if you have already paid the key money.

 

Key money can be a guaranitie that you have no longer a middleman/woman that can terminate your rent if somebody offers more, because you might have created a good business, and the customers might not care if the owner change. If the tenant has paid for making the cover and storage, then key money is also compensation for taking that over. You could compare with renting a open area, and pay for having a shade and storage build; i.e. is the cover and storage worth 30k baht?

 

The tenant might be in need of cash, if she continue to talk about a take-over, which you can use to try to negotiate lower "key money". Also find out if there is a written agreement with a specified rent with the landlord/owner, including permission to transfer, and sublet, that your wife will take over; however, many agreements can be based on spoken word and trust only...🙂

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1 hour ago, khunPer said:

You are not renting the public pavement, you are having a permission to block the front of someone's property, and you pay a fee for that permission. The same happens with beach fronts, where for example a beach massage platform pays rent, or commission per customer, to the land owner behind, even the actual beach belongs to the Marine Department, which actually can ask the business to be removed, or set restrictions of how much of public walkway can be blocked. The latter often happens for beach restaurants and sunbed rent outs. There has also been numerous cases a few years ago in Bangkok about removal of businesses that blocked public pavements.

 

Yes, it is "normal", and also normal that key money moves on to the next tenant. If it was a bar or restaurant, the key money could easily be in hundred thousands, or millions, for mainly a structure on rented land; a structure that would be mostly worthless if the rental is given up.

 

You cannot make any agreement of rent longer than three years, as it otherwise need to be registered on a land deed and tax paid; however you cannot register a lease on a public pavement. But if the covered area is private, you can register a longer lease for up to 30 years, or make a written rental contract for up to three years.

 

"Key money" is normal in Thailand, and lot's of business work with small commission here and there, including renting from a middleman/woman. Taking over the rental agreement could mean a little lower rent – the tenant would probably make a small profit by renting the space out for a higher rent that is paid to the landlord/owner – however, if you renegotiate the agreement, then the landlord might increase the rent to the level you pay now, or even higher, if you have already paid the key money.

 

Key money can be a guaranitie that you have no longer a middleman/woman that can terminate your rent if somebody offers more, because you might have created a good business, and the customers might not care if the owner change. If the tenant has paid for making the cover and storage, then key money is also compensation for taking that over. You could compare with renting a open area, and pay for having a shade and storage build; i.e. is the cover and storage worth 30k baht?

 

The tenant might be in need of cash, if she continue to talk about a take-over, which you can use to try to negotiate lower "key money". Also find out if there is a written agreement with a specified rent with the landlord/owner, including permission to transfer, and sublet, that your wife will take over; however, many agreements can be based on spoken word and trust only...🙂

Your perceptions are pretty accurate of our situation....and I assume key money is based on value of potential return or savings. And yes a guarantee that a middleman wont pull the rug out, but no guarantee the owner would. There appears to be no guarantees in Thailand of anything. A lot of "hope for the best" and I could say in my experience generally people do the right thing, providing you don't expose yourself too much and present opportunities. She is definitely in need of cash, precisely 35k I would say. There is a shade and storage she told us herself cost about 8000 baht some 5 years ago. Fair enough. She has factored in another 10k for that even though it is 5 years old, could not be removed or sold and is lets face it, 5 years old. 

 

To answer your question no.....we could rent in another area direct from another owner, for the same rent we are paying now....no key money with a shade, but we may have to buy some sort of lock up....5k tops.So that os the market value of what she is trying to sell. Its not a busy market where people are clamoring to get in. There are untenanted sites there already around the same rent, no start up fees so she is trying to sell a pup.

 

And yes the rent will be a bit cheaper which will be a future saving we need to take into account.

Wife actually met with owner today and she seems very good. She's not prepared to cut the other girl out, says shes always paid on time but agreed the price she is asking way too much and she will only end up with no tenants and lose money for three months as she did before we came. Her actual estimate of what the key money should be was exactly the same as I thought. If we sign directly with her the rent will stay the same. no deposit and can have a lengthy lease agreement with an option so there is no problems there. Now wifes job is to convince the owner it is in her best interest to accept a lower value or risk getting nothing or worse lose money

 

My strategy is to offer her what I consider a fair price, taking into account the structure and some good will or key money....And tell her the offer is only on the table for a week. If she thinks we will stay there paying rent until she finds a buyer she is wrong. She can look for a buyer but we will inturn look for another site, possibly leaving her without rent for a lengthy period

 

 

Edited by Kenny202
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On 9/3/2020 at 3:20 PM, Kenny202 said:

My strategy is to offer her what I consider a fair price, taking into account the structure and some good will or key money....And tell her the offer is only on the table for a week. If she thinks we will stay there paying rent until she finds a buyer she is wrong. She can look for a buyer but we will inturn look for another site, possibly leaving her without rent for a lengthy period

If you can let us know how the situation ended eventually

with a short update here on your topic

thank you in advance

 

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2 hours ago, kingofthemountain said:

If you can let us know how the situation ended eventually

with a short update here on your topic

thank you in advance

 

Will do. Wife will talk to landlord / middleman end of the month. We decided better to let her hang for a bit, give her less time. Will be a little while before we know anything concrete. I really don't think she will cave though without at least looking for someone for a few months. Wife's business over the holiday weekend and after has been dead. I always thought there would be a lag in time from when covid started to bite and it could well be now. Up until now I haven't really seen evidence of people tightening the belt. By the end of our lease we may not even want to resign a lease, let alone buy a restaurant for any money

Edited by Kenny202
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58 minutes ago, Kenny202 said:

Will do. Wife will talk to landlord / middleman end of the month. We decided better to let her hang for a bit, give her less time. Will be a little while before we know anything concrete. I really don't think she will cave though without at least looking for someone for a few months. Wife's business over the holiday weekend and after has been dead. I always thought there would be a lag in time from when covid started to bite and it could well be now. Up until now I haven't really seen evidence of people tightening the belt. By the end of our lease we may not even want to resign a lease, let alone buy a restaurant for any money

Yes the time is definitively on your side in this story

 

i hope your wife business will be ok in the next weeks\months

unfortunately i am not very optimist about the global economy in Thailand

the side effects of the whole ''virus crisis'' start to wave in all the strates

and it's just the begining with a domino effect, all could be go south very quick

 

it's urgent to wait and see, prepare for the worst and hope for the best

 

good luck

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Shes lucky. She doesn't need the money. I pity some of the poor buggers here that live hand to mouth. Must be a tough place to get out from under if you are a native and behind the eight ball

 

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