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Exploring The Market

Why commercial tenants and buyers need to analyze all options

 

You may have heard us recommend that all our clients should explore all viable options in the market with each opportunity, and we whole heartedly stand by that.

 

Yes, even if the business owner’s preference is to just simply renew their existing lease, there are still benefits to reevaluating their space needs and exploring the market:

#1. Education

Commercial transactions have a long-term impact on a business. With real estate being one of the top line items for the budget and with even the shortest leases lasting for several years, all real estate decisions should be taken very seriously. Furthermore, because business owners are likely not changing their real estate situation often, it is likely that with each opportunity, market conditions have changed. Therefore, the business owner must compare their current terms to the current market to educate themselves on what is considered a good, bad, or fair deal.

#2. Competition

Negotiating on multiple properties at a time will create competition to provide the business with more leverage. Landlords are never going to make their first offer their best offer, especially if they don’t think the tenant is even considering going anywhere else. If a seller thinks a buyer is going to buy their property no matter what, why would they be willing to negotiate? Business owners – both as tenants and buyers – do have leverage, and we encourage them to use it.

#3. Peace Of Mind

When it comes time to sign, a business owner will feel more comfortable with the final decision knowing that all the alternative opportunities were investigated too. Even if the business owner decides to renew their lease, they’ll be assured they’re getting a good deal and made the best choice for their business.

Feel free to share this downloadable PDF handout with anyone who may find it helpful.

 

This information – along with other tips we’ve shared this year – is part of a larger guide we created for people like our clients – The Essential Guide For Commercial Tenants and Buyers. We understand that a more educated commercial tenant/buyer has a more easier time making decisions for their businesses and ends up with better outcomes.

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