After finding the right office for your business, you’ll enter into the transaction process. This next step will consist of several important items: such as the lease negotiation, review and planning the buildout. Many of the opportunities that lie within the this phase rely on the success of your lease negotiation. If it’s handled properly, it can provide a number of long-term, tangible benefits for your company. Having a knowledgeable broker on your side throughout the transaction will simplify the entire process and provide long-term benefits for your company.
Lease Negotiation
Perhaps the most innately complex piece of the moving process is negotiating a fair lease, and executing a successful negotiation can provide direct benefits to your business for years to come. At the beginning stages, your broker will gather multiple proposals to gain an understanding of market comparables to increase your negotiation leverage. The key to doing so is understanding the market as well as the varying terms and clauses laid throughout the lease. Experience is critical to being able to expertly navigate the twists and turns of a lease. Beyond market knowledge of fair rent values, having a deep understanding of the language a lease is written in will help you negotiate for rent abatement, tenant improvement allowances, escalations, securitizations, rights to expand or renew, and termination rights.
The negotiation process will include several rounds of back and forth offers which will continue until acceptable business terms are agreed upon. Tenured brokers will be able to evaluate the financial impact of each proposal to submit a reasonable counter offer to advance negotiations toward your goals.
Lease Review
After business terms are agreed to, it is heavily recommended to have an attorney read through the lease. Should you not have an attorney on-hand that specializes in real estate, a broker will be able to refer a qualified real estate attorney to assist in the process. The broker will work alongside the attorney to evaluate the language within the lease to ensure it accurately reflects the agreed upon terms, as well as search for any terms or clauses that may be unfavorable to the tenant.
Check the language for mention of the common area maintenance fee to ensure it is based on the total rentable area rather than just the rented area. Another consideration might be to ensure the building cannot rent to your direct competition. Small changes such as these can have a profound impact on the longevity and quality of your new location.
Working with a Tenant Advisory Group representative will add many benefits. They will quarterback the process to ensure it is completed efficiently and to your specifications. Clients that work with the Tenant Advisory Group brokers will gain access to a deep pool of knowledge on current market values and apt negotiation skills.
