Lease Negotiations

Commercial Lease Negotiations

“Give me a lever long enough and a place to stand, and I will move the world.”

– Archimedes

Leverage is the key to any negotiation.

In a successful real estate transaction, leverage comes from understanding market conditions; having an accurate, detailed and complete analysis of every possible option under consideration; and creating competition for your business among multiple building owners.

Once MAP has worked with you to clarify needs, identify options, analyze financial terms, and design a space plan, the stage is set for the formal lease negotiation process. MAP will tailor a negotiating strategy for each finalist building to insure you get the price and the terms you want.

The first step is to address the economic issues that will affect your costs over the life of the lease. The “price per square foot” is merely a starting point. The actual costs of a lease involve a multitude of economic factors, including gross versus net rental structure and rates, variable versus fixed escalations, and tax and operating expense pass-throughs. Other important factors that may affect your organization’s costs, such as options for renewal, termination and expansion, are also addressed. At this stage, MAP’s detailed and comprehensive financial analysis will give you the information you need to understand the real costs of a potential lease, while MAP’s negotiating experience will help you keep those costs as low as possible.The next step in the process is negotiating the language of the lease document itself, which should involve your lawyer. MAP will work with you and your legal counsel to carefully examine and negotiate the specific language of all lease drafts submitted by the building owners. The purpose is to safeguard every negotiated term of the lease and to make sure you get all the benefits you expect over the life of the lease, even if the ownership or management of the building changes.

When the negotiations are concluded, you can be confident that you got the best deal possible.