Author: Aaron Weiner This post originally appeared on Insights and is republished with permission. Find out how to blog with us on theBrokerList.
Lease Intelligence
Foot Dragging Kills Deals
When you haggle over the purchase of a used car, what is your most powerful tool? It is, of course the fact that you are standing there ready to drive the car away with the pink slip in your hand and your money in theirs. Do you say “if you will lower the price by $500, I’ll think about it and get back to you next week”? No way. Checkbook in hand, you say “knock another
$500 off and I will write a check right now.”
The same is true for commercial real estate leasing but many tenants fail to see the parallel. We are just emerging from the COVID pandemic and every tenant is aware that many landlords have been rocked by the disruption to their business. Will they agree to a lower price? Will they spend the money to remodel the space or contribute to the tenant’s improvements? Yes to
both. But tenants expect the landlord to come begging and that’s not how it works. If you want to score a great deal, have your financials ready to share, be clear on your move-in date, and put a bona fide offer on the table promptly. That motivates the landlord.
Candidly, these situations have caused me more than a little frustration. I have a restaurant tenant that let a great location complete with kitchen slip away because he didn’t have his financials in order and the landlord leased the space to another cafe that did. I have a warehouse tenant that lost out on an excellent warehouse space that was just what they were looking for
because they took too much time twiddling with the lease offer — an electrical contractor put his offer on the table sooner and claimed the upper hand. I even had an office client that wanted me to advertise that he was looking for 1,300 square feet and thought that landlords would fall over each other to get his business. 1,300 square feet. I had to fire that client.
Whether the market is tight or soft, be aggressive, adopt a sense of urgency and the deal will roll your way.
Do you have your own lease challenges that you would like to discuss? Feel free to call me directly or send me an email.
Aaron Weiner, CCIM, CPM, LEED AP
[email protected]
(213) 258-6921
