6 Ways to Maximize Competition for Your Commercial Tenancy

Great commercial real estate tenants get the best deals for their tenancy. As a corporate tenant, it is essential that you keep the fixed and running costs of your business as low as possible. One of the best ways to do this is by choosing the landlord that offers you the best deal. You can’t do this if your tenancy is not valuable to your current landlord. In this article, we are going to explore six ways by which you can maximize competition for your commercial tenancy.

1. Make Timely Payments

Good landlords do not want to lose a tenant who does not default on their monthly rental payments. If you make timely payment, you can use this as leverage to explore other tenancy options. For instance, you can check around the neighborhood for lower rental rates or more favorable tenancy options and present them to your landlord. This gives your current landlord the chance to match the lower (or more favorable) rates, or you move to a new building. Either way, you will be saving money on corporate real estate costs. This is good for your business.

2. Use a Tenant Rep Broker

When you use the service of a tenant rep broker, you are able to separate yourself from the grind of negotiation. A good commercial tenant rep broker has a solid understanding of the market. By using the service of a broker, you will be able to explore other commercial real estate options that you may not have noticed. In addition, brokers have the knowledge and expertise in obtaining good deals for commercial real estate tenants.

3. Consider Nearby Markets

While it may be a bit uncomfortable for commercial real estate tenants to consider nearby markets, adjacent markets sometimes offer lower rates and better tenancy options. For example, there are times that while Midtown Manhattan has enjoyed very low vacancy rates, buildings in Lower Manhattan have been hard to lease. During the heat of the dot.com craze, many companies left Silicon Valley to set up locations in the Sierra Foothills outside of Sacramento, 100 miles to the northeast. In Minneapolis, the intersection of Interstate 394 and 100 frequently offer lower rents than the office market centered a few miles to the south at 494 and 100. The lower-cost northern market also offers better access to downtown and better proximity to affluent western suburban communities.

4. Include Pre-construction Space in Your Search

This is a good way to get amazing deals. If you find yourself in a hot market, look for pre-construction space that is about to break ground. By signing up for a pre-leasing contract, you enjoy amazing offers, such as comparably lower rents, and new space with new amenities.

5. Timing is Important

To maximize competition for your commercial tenancy, you need to begin looking for a lease within a time frame that is comfortable for you; this is necessary to maintain the flow of your business. One mistake that many corporate tenants make is approaching a landlord for a renewal when the lease is about to expire. Even if you are able to renew your lease, you may not get a great deal. This is because the landlord would have discovered that you have a limited time to negotiate. Hence, it is essential to approach your landlord and other landlords very early.

6. Consider Sublease Space

Sublease space is often available on the market, and they offer a cheaper way to get into space, especially in an ideal location. In addition, you can make an agreement with the landlord to either take over the tenant’s option when it expires or pre-negotiate your own renewal or extension. Occupying an inexpensive space is an excellent way to pre-negotiate with other landlords.