key money for retail outlet

S

shalamar

Guest
I am in the process of obtaining a lease on a retail outlet in Clontarf. The lease holder is looking for "key money" for the lease of 70,000 euros. Does anyone know any details about key money and whether this seems like alot to pay. The outlet is on the seafront in a good location and is 70sqmt. My understanding is that this key money is transferrable, ie I can sell on the lease for the same amount, however, this is given that I am paying the right price for it in the first place
 
Excuse my language, but I'd tell him to f*ck off. The Clontarf seafront is hardly Grafton St.
 
so I take it you think this i grossly over-priced!!
what do you think would be a reasonable amount to pay?? or should there be any key money involved at all?
 
it depends on the lease, if there is 15 years left on it and its 10k a year then its not a bad deal, if there is 20 odd years on it and the place is "rack rented" (i.e. more or less current market value) then its not such a good deal
 
The lease has 20 years left (of a 30 year lease) and is currentky at 30k a year. so I guess in response to what you said, this is not a good deal. Does anyone know anything about "key money" rates, should I be paying anything for proprty for Clotarf, or is it expected to pay some fee for the location/lease.
 
key money is a bit of a grey area, the idea is that i have a place i want to sell on, the rent i pay is less than the market rent and if you were to take the place with a new lease then the rent would be a lot higher, so there is a value to my lease as my rent is less than the market, that value is the key money, estate agents will give you a value for it, but imho 30k p/a for a 70sq mt place is pretty much market rent so i dont see a value of 70k on it, it would depend on the shop, parking etc. If it is trading and you intend to trade as the same business etc then there may be value in the business rather than the lease
 
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