Welcome. My name is Rob and I’m a Commercial and Retail Property Manager with over 20 years experience.
In this short video, I’ll give Landlords a few tips on how to best negotiate a lease renewal.
Market Knowledge: Know your market. Know your data. Know the historical leasing trends in your area. The going rate in your area. Know what the vacancy rates are. There are a bunch of factors there, once you research those factors you’re in a better position to then negotiate and negotiate aggressively.
Timing: Don’t start lease negotiations too early. A Tenant will typically want to start negotiating with you 6-9 months prior to lease expiry but as the Landlord, that’s not always the best option for you. The longer the Tenant has to negotiate with you, the longer they have to move, look at their other options, implement a plan of action.
If you’re a Tenant and I said to you, you’ve got a month or two, to make a decision on your rent or your lease if you want to stay or go, you’ll go into a panic because as a Tenant, as a running business it’s hard for you to pick up and move in a month. You have your staff, you have your clients, you have your fit out etc. But if you have 6-9 months to make a decision and negotiate and as a Tenant you’d say great thanks for the heads up, I’m going to go do my research now.
Research Your Tenant: Generally, when a Tenant negotiates a lease their main concern is fear of loss. What does fear of loss mean? It’s basically a Tenant who is dependent on the location to exist. For example, freehold property, some Tenants also need high clearance, a Pharmacy wants to usually be around a Doctor, for example, a mechanic finds it hard to get approval to be in any strata complex. So this is their fear of loss which is your leverage. Research your Tenant.
I hope this information has been helpful. As always, please feel free to contact me, I’m happy to help.