Lease Negotiation: Getting Some Help
Negotiating a lease can be confusing, especially if you are not up to date on the jargon characteristic of the real estate industry. That's why business tenants often turn to their brokers for advice come lease renewal time. And that can be smart, since landlords will often avoid proposing questionable terms when they know experts will be perusing the fine print. Just the fact that you have a broker will encourage your landlord to offer a better deal.
Prior to deciding on a broker, though, ask for references in terms of current clients. Then get feedback from the references. Did the broker pursue better lease terms tenaciously? Bring in a lease that was "on budget" in terms of your current needs? Complete the work on time? And how well has the broker's lease withstood slow erosion by operating expense pass-throughs?
Be aware there are two types of brokers: "tenant" and "landlord." The latter represents space marketed by property owners, so there can be a conflict of interest when it comes to lease terms. It's smarter to use a "tenant broker," who represent tenants exclusively.
You may want to seek the help of a consultant who specializes in property leases. One good source of experts is the membership list of the Counselors of Real Estate (CRE), comprised of real estate, financial, legal, and accounting firms who specialize in property lease negotiations. Visit their website at www.cre.org and click on "Find a CRE" to locate a counselor in your region.
Looking for definitions of the leasing world's puzzling terms? Visit the website of the International Tenant Representative Alliance at www.leasesmart.com. Click on "Lease Terms and Definitions."