At the end of 2012 our company was so over-crowded some people had to ask their nearby colleagues to get up so they could go to the bathroom. (I wrote about some pretty funky workspace compromises as far back as 2009–but we kept grabbing new rooms in this house, and nearby buildings, to get by.)
In the first week of January 2013, I hit the pavement looking for a new company home. Boston.com actually broadcast our search and an ambitious commercial real estate broker reached out to help. We made fast progress.
My top choice of location was Davis Square, in Somerville, which is Boston’s “Brooklyn.” Within two weeks we found a 5,000 square foot brick and beam factory built in 1921, with a large 1950’s add-on extension. The entire building was turning its leases over, including five suites of offices. Given the direct connection of our company to Makers, I immediately focussed on the original factory space suite (with historic texture, super high ceilings, wooden beams etc.), plus an odd circular shaped former “yoga-cult” suite behind it. We could use that suite for our development and media studios. (Bonus: the big circular part was soundproof. Why would a yoga studio need to be soundproofed, I ask you?)
After some typical back and forth, the landlord and I signed a Letter of Intent (LOI) agreement.
And then all hell broke loose.
Whereas I had negotiated the terms of the deal in relative isolation in the early new year, the economy was picking up and the other CEO’s in town started coming out of the woodwork, also looking for a 2013 relocation. There was a lot of interest in the building. I was not well-protected with our agreement, as an LOI is not legally binding.
Then, somewhat predictably, one VC-backed company offered to take “our” space at a much higher rent if the landlord would back out of the Grommet agreement. Their offer equated to an additional $250K of rent to the landlord, over the course of their proposed lease.
Being a good businessman, the building owner called me, telling me about his predicament, and offering me our same deal for other suites in the building or, simply, cash to go away. I told him I would think about it and call him back.
I got off the phone. I realized we did not have a lot of leverage. But I also knew that if I let the space go, we would be into a fresh and high-pressure space search, in a hotter market (several weeks had passed getting to the LOI agreement) at a higher rent. There was absolutely no upside. And most of all, the Davis Square building had really already become our company’s happy new “home”, at least in my mind.
Twenty minutes later, I called the landlord back, offering to take a longer lease at a slightly higher rent (though nowhere near the competitive offer).
Because you showed good faith in offering to change the deal, I will honor the original terms. There was a time in my life when I had more time than money. Now I have more money than time and I care more about the relationships I build, and their legacy.
Woah. What a decent, unexpected thing to do. The landlord asked me some questions to assure himself that I was committed to the relationship, to running Grommet indefinitely, and also to completing the lease so that his good faith would be returned.
It has been, in spades. We hired a great architect and contractor, and invested a great deal of creativity, elbow grease, and some capital in dramatically improving the space. We put in a perennial garden all along the front street side of the building, and installed window boxes at the entrance to improve the exterior. We are being kind to the neighbors in this largely residential neighborhood.
We keep parking density low with subsidized T passes. We’ve had the Somerville mayor officiate at our ribbon cutting, hosted many community tech events, and state government officials have also paid a call. We are respectful tenants, in it for the long haul, and doing our best to pay it forward, at least to the decent guy we call our landlord.
I smile every time I think of him. Which is pretty much daily, in our happy new company home.