How to Prepare for a Commercial Lease Negotiation
The current property market has encouraged many people to be involved in commercial lease negotiations. It has resulted from many businesses shifting from the buildings they are in to new and better premises. Many activities in the negotiation process are controlled by the landlord because the marketplace is the only place where you can find commercial properties for lease. A lot of efforts have to be made in preparing the property before the negotiations start to ensure that the landlord’s position is safe.
Letting of either the industry property, retail or the office property has become a source of income for the commercial real estate agents. It is important to remember that the best real estate agents are those that are very familiar with the lease negotiation. Apart from that, they should understand how negotiations affect the value of the property. With the prevailing market conditions, it is important to get the lease optimized to the cash flow need of the landlord. Ensuring this will offer you the advantage of obtaining a great investment.
It sometimes becomes difficult for landlords to lease premises especially if they have set harsh conditions on the premises. The clients will not agree to rent properties that have been vacant for too long. The potential client s will opt to lease property from an investor who has maintained their property well. In case there is any vacant building, the landlord should make all the efforts that can attract tenants to rent it.
The value of a property is determined by the amount of income it has sourced after a specific time. It is always possible to adjust the rental with creative rent review provisions that apply throughout the lease. Enough inspection should be done on the property to ensure that it is in good condition before the tenant comes to see it.
The planned lease plan not only affects the landlord but also the tenant. The landlord should find out how their business cycle works and how the customers will be impacted by the move of property. It is up to the leaser to know from what time they can stay in the building.
It is important for the tenant to outline the requirements of the property that they need to lease and pick a property that suits the requirements. The tenant should know how one building defers from the other.
Most clients are flexible enough to choose the buildings that are improved. During the early stages of the negotiation, the tenant should bring forward such issues.
Negotiation needs to be based around the ideal start rental. The negotiation should be based on the current available space and any expandable spaces, design requirements.
Preparation is the key to a successful lease negotiation. It will tune your focus to the tenant and the landlord to achieve an equitable and fair lease outcome.