Office space rental market
After seven years of distinct advantages for office tenants, commercial vacancy rates have come down, and the landlords gained an upper hand when it comes to re-negotiating the lease.
It is expected that the landlords will significantly raise their renewal rates, attempting to recover, if only in part, their perceived losses during the 'tenants' market' during most of the last decade. It will be most difficult for those who will be renewing their leases. Landlords know that it is a hassle to locate new premises for business, negotiate a new lease, and move.
When facing upcoming lease renewal, commercial tenants should do some research and come prepared. Analyze their needs, check, if possible, on the situation in the landlord's portfolio, and hire a professional to do negotiations. Using the research and the professional advise tenants may be able to figure out what is the lowest renewal rate below which the landlord would be willing to lose the tenant.
Such research should be done well in advance of the coming renewal, well before they have to give the landlord their notice. Depending on the size of required space, it might be advisable to start such research and planning even three years in advance.
The cycle in office space vacancies has been approximately 10 years, experts say, and the rents can vary substantially. It would be wise to negotiate a lease that would expire during a high vacancy period.
It is expected that the landlords will significantly raise their renewal rates, attempting to recover, if only in part, their perceived losses during the 'tenants' market' during most of the last decade. It will be most difficult for those who will be renewing their leases. Landlords know that it is a hassle to locate new premises for business, negotiate a new lease, and move.
When facing upcoming lease renewal, commercial tenants should do some research and come prepared. Analyze their needs, check, if possible, on the situation in the landlord's portfolio, and hire a professional to do negotiations. Using the research and the professional advise tenants may be able to figure out what is the lowest renewal rate below which the landlord would be willing to lose the tenant.
Such research should be done well in advance of the coming renewal, well before they have to give the landlord their notice. Depending on the size of required space, it might be advisable to start such research and planning even three years in advance.
The cycle in office space vacancies has been approximately 10 years, experts say, and the rents can vary substantially. It would be wise to negotiate a lease that would expire during a high vacancy period.
Labels: Rental market
0 Comments:
Post a Comment
<< Home