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This Summer is an Ideal Time for Commercial Real Estate Lease Renewal
Date:7/29/2009

ir existing tenants, as a "captive audience." Selinger reminds tenants that a "landlord can set his watch by the fact that most tenants don't like to move and will contact him about renewing their lease. Landlords also know from experience that Mr. or Ms. Tenant won't generally pursue other options or obtain knowledge about the current office leasing market; thus the tenant will have no leverage and is likely to agree to a modest rent increase."

But, Selinger warns, the best way to approach lease renewal is with a market-driven strategy. Selinger provides an apt example: "While it may feel good to negotiate yourself a $.75 PSF annual increase to renew your existing $26 PSF lease, the current market may only be demanding $22 PSF and offering tenant improvements and free rent concessions." The solution, Selinger claims, is to "hire a tenant broker who makes a living knowing the market. But not just any broker. Hire a tenant representative who does not represent landlords, has no conflicts of interest, and will never work for your landlord or any other landlord."

A landlord will only give a renewing tenant the same kind of deal new tenants get if he believes that you have alternative locations. So, according to Selinger, "when you approach the landlord with your tenant representative, the landlord will know that you've done your homework and created options, whether you use office space or industrial space, and
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