5 End to Commercial Lease Tips.
The renewal time of your commercial lease provides you with the opportunity to assess your current position, check the real estate market, and negotiate a better deal. As a commercial tenant, it is important to stay well-informed about your options and understand your business’ needs. At the end of your commercial lease, you should take the right steps to secure the ideal deal.
At Belmares Properties, we have a few important tips for you to follow at the end of your commercial lease.
1. Assess Your Business’ Needs
You should assess how effectively the current premises are working out for your business. Ask yourself the following questions:
- Is your business using the entire available space?
- Does it seem that the office space is filled to capacity and there is no more room for your business to grow?
If your business’ need for space has changed, you will need either lesser or more space. This can mean that you will have to explore other premises.
2. Consider Improvements or Moving
When there are no more than a couple of issues with your office space, you can negotiate a renewal with tenant improvements. You may also negotiate a period of free rent so that you can spend on the improvements. Keep in mind that landlords prefer keeping their current tenants, as it is cost-effective compared to finding a new tenant.
3. Explore the Commercial Real Estate Market
Even when you decide to renew your commercial lease, it is important to have knowledge of your market. It is likely that you may come across alternatives that may be worth considering. Market conditions and real estate availability keep changing over time. You may come across other landlords that offer more favorable terms, lower taxes, and better amenities.
4. Consider Renegotiating Everything
Your market research and your commercial real estate broker should help you renegotiate your contract terms. If there is an option, you can negotiate for a better deal or go ahead with signing the contract.
Just because you have a commercial lease renewal contract, it doesn’t mean you have to use it.
- When renewing, start early so that there is no chance of your option expiring
- Explore the terms that can be negotiated
- If the market has changed significantly since you signed the lease, and you have an option, you can work on negotiating a better deal
5. Create a Plan
Taking cues from the above-mentioned points, don’t give your landlord the impression that you are fully intent on renewal. If they know that you are going to renew your lease, they can:
- Pursue less favorable terms for you
- Be less inclined to negotiate
- Decline some or most of your requests
When it comes to the end of the lease, you should follow a strategic approach. Let your landlord know that you have done your market research and are well-positioned to negotiate. If you are looking for professional assistance in your commercial sale or rental deals, feel free to contact us at (210) 877-0815. You can also write to us.