Thursday, September 24, 2015

"Found Money" in Your Lease

When you enter into a lease the usual expectation is that you'll be making a steady stream of payments to your landlord and that it's a one-way street! 

What if you could negotiate some creative ways to channel some cash flow back to you?

Since your lease payment is likely to be one the largest expenditures your business will have, it makes sense to carefully negotiate your lease before entering into that financial commitment.

We also recognize that this is an area where most entrepreneurs have limited experience. Because of that, we've always encouraged our business clients to engage the services of experienced professionals to assist them in those areas where they can add a tremendous amount of value.

In this post, we're pleased to share the following tips and suggestions from our friends at The Lease Coach. Please enjoy the following as Dale Willerton and Jeff Grandfield share their helpful insights with our audience!

Dale Willerton

Jeff Grandfield

Negotiating Commercial Leases & Renewals For Dummies
Commercial Leasing Tips for Commercial Tenants
By: Jeff Grandfield – The Lease Coach 
For many business-owners, negotiating a good lease or lease renewal against an experienced agent or landlord can be a challenge. While an entrepreneur focuses on marketing and managing, savvy real estate agents and brokers are specialized sales people. Their job is to sell tenants on leasing their location at the highest possible rental rate. 
As explained in our new book, Negotiating Commercial Leases & Renewals For Dummies (co-written with my colleague, Dale Willerton), tenants may go through the leasing process only two or three times in their entire lifetime – yet they have to negotiate against seasoned professionals who negotiate leases every day for a living. Negotiating appropriate leasing terms is vital for an entrepreneur as the amount of rent he pays will directly affect the business’ financial bottom line.
Whether you are leasing a new location for the first time or negotiating a lease renewal for your business, these are some money-saving tips for tenants:

Ask for More Than You Want: We remember a tenant coming to us hoping we could negotiate a $500 per month rent reduction for her business. During the ensuing months, we met with the tenant’s landlord and insisted on a $1000 per month reduction. Eventually, our efforts paid off with an $800 per month reduction (or approximately 25% less). Ask for more than what you want or need when negotiating other items as well such as free rent, signage, and leasehold improvement money. The worst the landlord can do is say no!
Need Vacancy Protection? If proper tenant mix and traffic flow is important to you, then you may need vacancy protection. Look around the property and ask – would it adversely affect my business if any one of these tenants moved out of this building, or if the property was 30% (or more) vacant? For retailers, this can be especially important if one of the anchor tenants relocates. Therefore, negotiate in advance for an automatic rent reduction or even the right to terminate your lease should the tenant mix or occupancy rate be compromised to your company’s detriment. This can be especially relevant if a grocery or department store anchor leaves the property.
Tenant Allowance Advice: Receiving a Tenant Allowance will assist you with doing leasehold improvements. Sometimes you can negotiate to receive some of the money up-front so you won’t have to finance 100% of it. Occasionally, a landlord can’t or won’t pay the money they agreed to pay. You can try to include a clause that says if the landlord doesn’t pay the allowance, you will receive 150% of the allowance in free rent. Either way, this provides your landlord with an incentive to pay, or you receive reasonable compensation.
For a copy of our free CD, Leasing Do’s & Don’ts for Commercial Tenants, please e-mail your request to  

Jeff Grandfield and Dale Willerton - The Lease Coach are Commercial Lease Consultants who work exclusively for tenants. Jeff and Dale are professional speakers and co-authors of Negotiating Commercial Leases & Renewals For Dummies (Wiley, 2013). Got a leasing question? Need help with your new lease or renewal? Call 1-800-738-9202, e-mail or or visit

What's been your experience? 

Please add your comments and helpful suggestions for our audience, and share this post with those in your circle of contacts!

* In Closing:  Has your BUSINESS PLAN taken your location and business growth requirements into consideration? 
Pro-Vision Solutions Inc. has a number of helpful ways to add this into your BUSINESS PLAN! 
Simply CLICK HERE for more information and details from our Website!

No comments:

Post a Comment