How Long To Lease

[Data Glasses]

The term lease seems to be appearing online a little bit lately so i thought i would do another poll ...........how long should a domain lease be ?


http://www.ricksblog.com/my_weblog/...aking-it-up-100-listings-to-be-announced.html

 

[snoopy]

"how long should a domain lease be ?"

However long the buyer wants. A lease is an alternative when a buyer can't afford to buy outright, so it needs to be a length of time that works for them.

 

[Data Glasses]

i guess i am asking what would be a standard , i nearly included 'as required' in the options

I felt around the five yeart mark was good for both

 

[theseoconsultant]

My guess for the "standard" leasing option would be annually with a BIN option at the end of the lease.

 

[snoopy]

i guess i am asking what would be a standard , i nearly included 'as required' in the options

I felt around the five yeart mark was good for both

Yes, I think 5 years. I think that length of time is common for cars, commercial real estate etc. If they want to know an example of what you offer would say 5 years with with options for each year.

 

[Data Glasses]

At that period of time the owner gets a solid return and the leasee knows if it was/is worthwhile and can go from there.

 

[Cooper Mills DomainLawyer]

its actually called a sub licence

I agree with Snoopy, but also make it clear that you can end the sub licence if they default in making their monthly or annual fee

 

[snoopy]

but also make it clear that you can end the sub licence if they default in making their monthly or annual fee

I think so, bank on a high default rate after the first one or two payments.

 

[findtim]

I think so, bank on a high default rate after the first one or two payments.

if they default they you aren't going to get the default money !

i voted 5yrs with buyout option, but how do you set that price 5 years in advance?

is it $1 like some car deals are? then its just "paying it off"

tim

 

[demandclass]

I voted annually. Like Snoopy said, it's more than likely a new business or an established business wanting to venture into a different vertical market that doesn't want to outlay a significant amount of cash on the asset and would rather bank roll it into establishing the business around the domain name. There are also tax benefits to leasing versus purchase.

The reason I voted annually is because that allows the client to fill safe in knowing that there is an end date as well as any option to extend, that should be in the agreement as well as rate of increase. A 1+2 is the way that I've written them with an increase of 20% pa with options to buy during time frame.

Also, one should include if they tarnish the integrity of the brand/name that damages shall be included and the lease can be terminated.

 

[Data Glasses]

Also, one should include if they tarnish the integrity of the brand/name that damages shall be included and the lease can be terminated.

a good point

 

[snoopy]

if they default they you aren't going to get the default money !

Just have a definite timeframe for when the DNS gets changed - short and send them a reminder email very close to the due date to avoid it dragging on. Defaulters usually go quite or make excuses to delay things rather than saying they won't pay.

i voted 5yrs with buyout option, but how do you set that price 5 years in advance?

is it $1 like some car deals are? then its just "paying it off"

tim

Need to factor in what it could be worth in 5 years, a long term buyout agreement involves a fair degree of risk, people have in the past ended up selling for a % of what it might get at auction 5 years down the track.

Good example,

"Editor's Note: A day after posting this report we learned from David Jeffs at Communicate.com Inc. that there is more to the Vancouver.com sale than meets the eye in the SEC filing. Mr. Jeffs told us that the original deal for the domain was a lease to own contract crafted in 2001. It called for 5 annual lease payments of 50,000 Canadian dollars, with a final purchase payment of 150,000 Canadian in 2006 (the $123,000 referenced in the 10Q report). In prior years, those 50,000 CAD payments were shown on the books as lease payments. All told, Communicate.com received 400,000 Canadian for use of (and finally sale of) the domain over the past 5 years. Mr. Jeffs added that they Communicate.com Inc. not have made the same deal today."

http://www.dnjournal.com/archive/domainsales/2006/domainsales06_06_06.htm

 

[helloworld]

Why would you put any more than 1 year? You want to increase the price over time, right?

 

[findtim]

its such a hard one, you lease some "bricks" and they build a house ! what right do you have to say the bricks are now worth more?

they provided the mortar, the time, the skill, the workload.

all you did was provide the bricks.

i'm struggling with this concept as i really want a system for it, i have 3 realestate agents in my family so maybe after talking to them in the xmas break i might be able to nut it out better for myself.

bottom line is it needs to be win win.

tim

 

[Data Glasses]

Why would you put any more than 1 year? You want to increase the price over time, right?

you may wish to secure the income stream for longer, any options for price increase should be in the contract, not that i would do it but shopping centres base some leases on the shop's annual profit and adjust accordingly

 

[findtim]

you may wish to secure the income stream for longer, any options for price increase should be in the contract, not that i would do it but shopping centres base some leases on the shop's annual profit and adjust accordingly

with westfield i'm pretty sure if you don't make enough turnover, then they stop your lease.

tim

 

[Data Glasses]

I was reading about some affiliate companies that will start to charge you account fees if you are not making enough money ..........account fees ?? ......for what, haing a database