Commercial Strip Center

Five Ways to Get Commercial Tenants to Pay on Time

The goal of a good property management company is 100% rent collection every month but some tenants, especially smaller, more local tenants, will be slow to pay or will call with a story about why they cannot pay.  Navigating this can be time consuming and challenging.  Below are five ways that you can mitigate the damage on this and keep your rental collection rates high.

  • Be Proactive:

If we have not received rent by the 5th then they are getting a phone call on the 6th and a 3-day notice on the 7th.  Sometimes tenants do not have enough money to pay all parties and they are prioritizing.  By reaching out immediately we are sending the message that rent cannot be a low priority.

  • Understand the Tenant’s Health:

Every month we specifically meet with tenants from every building face to face and then report back on our conversations to the owners in our twice monthly reports.  During our conversations, we ask about the health of their business, concerns they have with the center, etc.  During these conversations we both build rapport and keep a pulse on the health of our tenants.  This is also very helpful when it is time to renew leases as we know which tenants to keep or move away from and what rental rates they can afford and the market will allow.

  • Know the Right Person to Talk to:

When tenants are not paying, it can sometimes be hard to get them on the phone.  At the time when leases are being signed, we document all possible tenant parties and their contact information in the lease.  This includes cell phones and email addresses.  At lease signing, tenants are excited and happy and will gladly give you their contact info.  Two years later, if things have not gone as well as they planned, then it will be harder to get a hold of them.

Also, with larger companies, it is important that you know which department or office pays the rent.  It may be a regional accounts payable person based three states away.  It is important that you know their contact information and how to reach them.  It is also important that they know who you are and there has been a personal introduction.  This will make everything easier when there is an issue.

  • Be Clear on What the Tenant Owes:

When you contact the tenant, you should know exactly what they owe.  Maybe they paid their rent on time but they didn’t make the CAM or NNN payment or there was a rate increase that they did not abide by or missed.

  • Walk the Tightrope of Empathy and Firmness:

No tenant wants to pay late.  They are trying to make their businesses work and are struggling for some reason.  It is stressful for them and it is important that you show empathy.  Often this means hearing them out for a few minutes and letting them feel heard.  Running a business can be tough.  At the same time, we explain to them that there is a process that we have to go through and we appreciate where they are coming from but we have to do our jobs as well.  We are compassionate, but we stay on track.


Working with Commercial tenants can be challenging and the most important thing is that you have a process that you stick with every month.  Tenants will get used to this and accept it.  When you have a sloppy process, tenants will sense that and take advantage of it.  Invest in your process and you will make a great return as more rent is collected on time and fewer collection calls have to be made.




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