As the end of your commercial lease in Michigan approaches, it’s time to sharpen your negotiation skills. Successfully navigating a lease renewal can secure your business’s location while potentially improving lease terms. How can you confidently approach your commercial lease renewal negotiation?
Start early.
Give yourself a buffer of at least six months before your lease expires to start the renewal process. This extra time allows for thorough preparation and strategy development, ensuring you are not rushed into unfavorable terms due to time constraints.
Stay informed.
Know the going rates for spaces similar to yours. This information can support your negotiation stance and can help you make informed decisions that align with your company’s long-term goals.
Review your current lease.
Go over your existing lease with a fine-tooth comb. Pay close attention to any clauses regarding renewal and make a note of any terms you would like to change. This change should include terms that allow for business growth and flexibility so that your business can continue to succeed in the future.
You should also look beyond the base rent when reviewing the terms of your lease. Other aspects of the lease—such as improvements, your opportunities for expansion, maintenance responsibilities or parking availability—can also have a significant impact on your business.
Get support.
Consider enlisting the help of a real estate attorney. Their expertise in the Michigan market can be a significant advantage. An attorney can help decipher complex lease language, identify potential pitfalls, and craft terms that safeguard your business’s future, giving you peace of mind that the lease agreement complies with Michigan laws and aligns with your company’s needs.
Remember that you provide value to your landlord.
Remember that negotiation is a two-way street; aim for a win-win situation where both you and your landlord can benefit. Long-term tenants who pay on time and maintain the property well are assets. If you fit this description, remind your landlord of your good tenancy when discussing new terms.
You should also remember that the value you provide your landlord is also an important source of strength when negotiating. Sometimes, the best negotiation position is being willing to relocate if terms can’t be met. If you show you have other options, your landlord may be more inclined to offer favorable terms.
By being proactive, informed, and strategic, you can approach your commercial lease renewal in Michigan with confidence.