Rent is the largest expense for most businesses. Therefore, it is imperative to take advantage of opportunities to renegotiate your lease.
As the economy continues to slowly rebound, many communities still have a lot of vacant commercial space. While this is bad news for landlords, it provides an opportunity for tenants to secure a reduction in rent or more favorable lease terms.
When renegotiating a lease midterm, much of your leverage is dictated by the rental market conditions in the area. Therefore, it's important to do your research. If the commercial rental market is flooded with inventory, you can probably negotiate many landlord concessions. If the market is tight or you are pursuing a unique space, you'll have significantly less leverage.
It is also important to be aware of your relative "value" to the landlord, as that will also impact your negotiating.
Below are several factors to consider:
- How much space you are leasing in the building;
- How much vacant space exists in the building;
- How long the space has remained vacant; and
- Your payment history.
Once you have gathered all of this information, you will be able to make a strong case with the landlord.
Finally, even if you cannot negotiate a reduction in rent, the landlord may be willing to offer other concessions. As they say, it never hurts to ask.
How We Can Help
If you are seeking to renegotiate a lease, it is imperative to consult with an experienced business attorney. Our firm can help you achieve your business goals, while also minimizing your liability. Contact us today to schedule a free telephone case evaluation.
