When preparing for lease negotiations, leave the gloves at home, roll up your sleeves, and take the positive offense approach. Consider the following steps to keep lease negotiations on an even playing field that produces the best results for both sides.
1. Write down what you want to achieve from the negotiation, including the financial and non-financial objectives. Know the few points that you are going to have to go to the mat for, and be open with the other side if they are giving you something that has little value to you.
For example, if you are considering a lease decide if getting a lot of free rent is more important than an increase in tenant improvement dollars. Tenant representative brokers have models that can give an objective analysis.
2. List your strong and vulnerable points so that you can be prepared to leverage or hone these to your advantage during the lease negotiation process. Taking stock of your strong points will help to keep them front and center when it comes time to step into the arena of negotiations. Keeping track of your vulnerable points will also help you to maintain your balance so that any conversation coming from the other side that attempts to highlight those point will be met with a well prepared strategy.
For example, if you are not considering to move for the right deal, you have little leverage with your landlord at the time of lease renewal. Take inventory of other tenants in the building and learn about what terms the new tenants are paying.
3. Conduct research to gauge competing properties. Being well prepared for any negotiation is to have a solid second (or third) alternative – then make a list of what would have to happen to make them your top choice. It is that type of confidence that will result in a “win”.
As an example, think about any purchase that you make online, whether it be something as small as a book, collecting data from different online vendors can aid in saving you money when it comes to making the final purchase.
4. Rely on a strong team to support you during the negotiation process. Having agents to speak on your behalf allows you to proceed knowing you have a team with specific knowledge in your corner. When choosing an agent, ask how their representation process yields results. Also, ask the agent what tactics do they have up their sleeve to effectively advocating on your behalf.
Download Prepared to Win/Win Worksheet and find out how other blog subscribers are effectively using this simple form to get what they want.
Some other great articles to read:
How standard commission agreements work for the broker but not always for the client – Part I
The allowance that disappeared – where did it go?
Image Credits: Gorilla & Kangaroo Boxer