Commercial Real Estate Lease Renewals
The most common type of transaction in commercial real estate is the lease renewal, and there are a few important things to consider when entering into this type of transaction.
The first is that there are two opposing parties involved. On one hand, you have the landlord who might see hundreds or even thousands of these types of transactions over the course of their career and on the other is the tenant who might only see three or four. Because of this, the scales are often tipped in favor of the landlord.
The second thing to consider in a lease renewal is timing. It’s in the landlord’s best interest to give you as little time as possible to consider your options. If you do not think you can move or the landlord thinks you won’t move, that will allow the landlord to dictate the terms of the negotiation.
Another important and often overlooked consideration in a lease are the dates. Most tenants believe the most important date in a lease is the expiration. That may not be true. In many leases there is a renewal notification period and with markets at an all-time high the renewal may be your best option.
The final thing to consider in a lease renewal is that you have a proven strategy to get you the best possible terms. At CARR, we’ve done thousands of real estate transactions and can tell early on which strategy is best in any given scenario. Every deal is different and your strategy should be as well.