In the current office real estate market, there are fewer tenant expansions and fewer new lease negotiations than most cities have seen in recent years. Because of this, many tenants are trying to limit capital expenditures and refraining from spending on tenant improvements to build out new office space. With what many tenants feel is an uncertain economic future ahead, a majority have indicated a preference towards shorter term renewals or extensions, which are generally viewed as less favorable by landlords.
Today, some tenants assume that engaging a broker to handle renewal transactions is unnecessary. Unfortunately, many tenants are likely leaving large amounts of money on the table by not taking advantage of a broker’s services when the lease comes up for renewal.
A broker can help create leverage, even if a tenant has no plans to relocate to another building. Brokers can also assist tenants in exploring both the costs associated and company impacts, when deciding to relocate.
The benefits to engaging a broker are clear:
Uncover creative ways to save on office space while negotiating a new lease term.
Create leverage with the landlord to garner the best outcome for either a renewal in the same building or a move to a new location.
Additionally, brokers are paid entirely by the landlord, so there is no out-of-pocket cost to a tenant for their services.
For these reasons, even in our uncertain real estate market, leveraging the negotiating power of an experienced broker can be the difference between a basic lease renewal and advancing your organization with a competitive deal.
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