Top Eight Commercial Real Estate Lease Negotiation Tips

1)   Begin the process early.  This provides negotiating leverage and wiggle room.  Start at least 18 months prior to your lease ending date.  Researching the alternatives can take 3 months, negotiating a lease can take 3 months, and constructing new improvements at another location can take 3 months.  Allow a generous amount of additional time for unexpected delays in the leasing process.

2)   Never give any landlord the sense that their space is the only one that works for your company.  That is when the landlord pushes the profit button.  You will never get the best deal available.

3)   Always create several truly viable leasing alternatives.  Get proposals from each.  Don’t give a positive indication to any landlord until you have in your hands a fully executed new lease or lease renewal document.

4)   Before beginning the process, consider engaging an office tenant representative broker.  If you are an expert in your business, you are probably not an expert in the commercial real estate office leasing business.  Market dynamics change daily.  A veteran office lease negotiator is much better equipped to manipulate the market to the tenant’s financial advantage.  Expect each prospective landlord to be a veteran office lease negotiator, manipulating the office leasing market to the landlord’s financial advantage.

5)   Ask your office tenant representative broker about “comps” (financial details on recent office leasing transactions in your local office market).  The more comps your tenant rep broker has to reference, the more effective he or she will be in manipulating the local office market.

6) Engage your own commercial real estate architect to verify the accuracy of the stated usable square footage of the office space.

7) Talk to other office tenants directly regarding a prospective landlord’s reputation in the areas of office building management and fair dealing.

8)  Engage your own commercial real estate attorney to review the lease document.  A good office tenant representative broker will also weigh heavily in the lease language negotiation.