Your Lease Expiration Date Isn't Really an Expiration Date

If you read your lease, you'll see that it usually has a very clear expiration or "lease termination" date spelled out. Usually, it's one of the easiest things to understand in your lease. However, for many tenants, it is also effectively meaningless. Your lease expiration date is your lease expiration date only if you can't work something out with your landlord, you can't sublease the space, and you don't have an option that allows you stay longer than you want. Ultimately, in the real world, everything is negotiable as long as you have a good strategy, good help, and you start far enough in advance.

Leaving Before Your Lease Expiration Date

If you need to get out of your space or reduce the scope of your tenancy before your expiration date, you generally have four options in front of you.

Get an early release. Sometimes, a landlord will let you leave early without any penalty. Typically, this happens when they either have a redevelopment of the property planned or if they have another tenant that wants to expand in your space. Usually, they won't come running to tell you, so it's worth asking.
Buy out your lease. Whether or not your lease has a buyout provision, you may be able to pay a single lump sum and be released from your lease early. Generally, the cost of the buyout goes up the longer that you have left on your lease, so you may not want to opt for this option if you have years left on your agreement.
Subleasing or assigning your lease. Another solution can be to find someone else to take over your lease. In this instance, you are usually going to remain responsible for the lease itself, but if another company is paying you rent, you can, at least, avoid some or all of the financial burden that it represents.
Shrinking your space. Finally, you can talk to your landlord about reducing the size of your space if the only problem with your current space is that it is too large. If you do this, your landlord might be more willing to work with you since you will remain a tenant.

Staying Beyond your Lease Expiration Date

If your lease is expiring and you want to stay longer, it's usually even easier to hold on to your space. Here are some options that you might have available to you.

Staying under a holdover provision. Many leases have a holdover provision that let you stay beyond the end of the lease on a month-to-month basis. If you only need a few extra months, this can be an effective solution, even if it carries some additional cost.
Using an option. Renewal options give you the right to extend your lease for a set period of time at set terms. In many ways, they are the best of both worlds. Having one means that your landlord can't remove you from the space as long as you comply with the option's terms. On the other hand, just because you have one doesn't mean that you can't renegotiate your lease renewal for an even better deal if the market will bear it.
Renegotiating your lease. Most landlords love getting calls from tenants who want to renew their lease early for a longer term. Longer tenancy means less cost for them, so an attempt to extend can usually open up some benefit in the renegotiation. Your landlord might offer tenant improvement money to help you spruce up your space for the long term or a rent abatement to share his or her cost savings with you.
Expanding your space. Finally, all of these options can work even better if you are also taking more space in the building at the same time. Usually, the more you take, the more the ownership gives back to you in the form of concessions.

Balancing Your Expiration Date and Your Needs

Since leases aren't quite as cut and dry as they might seem, some complexity exists in how you manage your expiration date. The first step is to have a legal review of your lease if you don't already have one. That will help you understand your legal obligations and rights vis-a-vis your expiration date, your renewal option, and any other rights in your lease. Then, once you understand the broad parameters in which you need to operate, it's time to get help from a tenant representative broker. Tenant reps are experts in representing businesses like yours in negotiations with landlords, and they can help you successfully consummate your transaction. With decades of experience, all of us at iOptimize Realty are ready to help you make your space fit your needs. Please reach out to us today -- hopefully, long before your lease's expiration date.