Your lease is nearly up, and it's time to renew. Now is a great time, experts say. The recession and resulting downsizings, bankruptcies and corporate closures have created opportunities for companies looking to stay in place and renew their leases. Vacancies are up nationwide, and subleases are driving down rents. That makes landlords nervous-and anxious to retain their current tenants.
To attract new tenants, landlords often offer concessions such as free rent or buildout allowances. But renewing tenants have received little more than a rent hike-until now.
Here's how to get the best deal on your lease renewal:
- Hire an expert. Consider engaging a broker who specializes in tenant representation. A qualified broker can help you negotiate your lease--to your financial advantage.
- Start early. Don't wait until the end of your lease. Allow time to negotiate with your landlord and to research alternative locations should he be unwilling to bend. Experts suggest beginning the process about a year before your lease expires.
- Keep information to yourself. To optimize your bargaining position, keep key information to yourself. For example, don't let your landlord know that his location is the only one that works for your business.
- Do your research. Always have several other alternative locations that will work for you. Get proposals from each so you can compare the details of each deal. Then approach your landlord with comps. A landlord is only likely to give you the same type of deal new tenants get if he believes you have alternatives and might leave.
- Get legal advice. Have a commercial real estate attorney review the lease before you sign it.
Been through the process already? I'd love to hear how you made out and what worked best for you in the comments.
If your lease is up for renewal soon, I'd be happy to assist in any way I can. Just drop me a line and let me know how I can help.