In today's commercial real estate market, vacant space leasing can be a real challenge for inexperienced real estate agents. In general, the rental market is biased towards tenants at this time. This gives them important powers in the negotiation of lease terms and lease levels.
Real estate agents who work on behalf of the landlord need to be very creative and committed to leasing activities to achieve the most efficient leasing and tenant exit. Hard work is needed to identify and utilize the target market for rental properties or leases.
The pain points of leasing commercial properties are as follows:
- Find suitable tenants with established and strong business
- Get a fair and reasonable lease that meets tenants and landlords
- Choose the right incentives to attract tenants
- Reduce the impact of long-term vacancy on properties
So, considering commercial real estate and the major real estate markets around it, let's take a look at these points.
It is absolutely essential to find tenants who can demonstrate a stable and strong business. This will come from the business history of recent years. In most places, there are still some tenants who can show stability even in times of economic hardship. A copy of the business history and business plan will give the landlord some comfort in understanding the stability of the tenant.
You can also request a testimonial from the previous landlord at the tenant's location. If the real estate agent is managing the property at the time, they can also provide some reference or recommendation to the tenant.
Getting a fair and reasonable lease in this market can be a challenge. At the beginning of this market lease, the landlord does not need to actively and fully rent the tenants. In terms of real estate performance, the landlord and the tenant are partners.
It is best to start the lease at a fair and reasonable rent so that the tenant remains stable for the year or two before the stay. If the landlord believes that parity or consistency with market rents is their concern, they can apply for market leasing in the middle of the lease or elsewhere in the lease.
Almost every tenant in the real estate market is seeking incentives as part of signing a new lease. Rewards are the cost of the landlord and need to be carefully considered. Most importantly, the question worth asking is what is the best incentive for the landlord. Here are some options, including rent-free, rent reduction, landlord funding renovations or cash payments. The landlord should make a decision based on the wise advice of lawyers and accountants. Importantly, the availability of incentives and leases should be protected by appropriate and sustainable bank guarantees in the leasing process.
Every landlord wants to avoid the vacancy effects of the inside of the property and cash flow. This means that all future lease expirations should be planned and minimized based on the property life cycle and the landlord's investment plan. To achieve this goal, real estate agents should work closely with the landlord to fully understand the real estate plan and incorporate it into the leasing strategy for each lease.
Orignal From: The pain point of renting commercial real estate
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