You might think that, when it comes to commercial real estate dealings, what you see is what you get. But that's not quite the case. You'd be surprised-with a bit of information and a deliberate approach, you can negotiate a lease deal that works in your favor. Here are five tips for how to approach lease negotiations that could wind up saving you some significant money.
Know your real estate market
The landlord will likely claim that the rent listed is fair and in line with the market. They may not expect you to do your research. Check out similar properties in the area-are other companies getting a better deal? If so, you have a weapon in your arsenal when you go to the negotiating table. The fact is that many landlords will quote a higher price initially, expecting the tenant to negotiate.
Lock in your price for the future
Sure, the lease price looks good now, but what about a year from now, or five years from now? Make sure you establish a cap for how much rent can increase over the long run. This language should be in your contract. You'll also want to protect yourself from responsibility for catastrophic costs or updates to the building that are required to bring it up to code.
Only pay for what you're getting
It's not just about renting a certain amount of square footage. It's also how much of that square footage you're using exclusively. Determining how much of the space you'll be sharing is crucial to knowing how much you should be paying. Your landlord should be able to tell you the load factor for your lease. Check the landlord's math, and hold them accountable.
Extend the time period of the lease
If you're willing to make a long-term commitment to the space, the landlord is likely to give you a bit of wiggle room when it comes to negotiating the lease. Finding new tenants is an expensive process for the landlord in terms of time, money and energy. Make sure you add a sublease clause that allows you to rent to other tenants in the event that your company's needs change.
Bring in professional help
Having an expert on hand in the form of a tenant representative is a smart business decision. This person can guide you toward the most cost-effective space for your business and ensure that your contract is airtight. Landlords will pay the tenant representative's fee, so it won't even cost your business any more.
If you have questions about how to best plan for your company's financial future, then the team at Imperial Properties can help. We've become a leading property management firm for a diverse range of clients in Western Canada because we offer peerless management expertise paired with exceptional service, knowledge, efficiency and cost effectiveness. Contact us today to learn more about how we can help your business succeed.