Mar
01
Retail Lease Renewal/New?
By
Thank you for taking the time to read this. Here is my situation: I operate a beauty supply business in a LA retail center. Our lease term was for 5 years and we renewed for another 5 years - making our stay so far at almost 10 years. We do not have any further renewal options and our lease is coming up in April 2008. I would like to renegotiate a new lease and remain in the center for another 10 years. I have done some research and it seems as though two of the tenants (8 tenants total in center) of the center will be vacating within a few months and their space has been put on the market with an asking rate of $6 PSF NNN. I am currently paying $4.50 PSF NNN.
My Question: How should I go about trying to renegotiate a new lease? I have never been late on rent payments and have never complained about anything. This store is my sole form of income and it will be hard for the store to handle anything more than $5.50 PSF. Thank you for your help, it’s very much appreciated.
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1 Comments
March 3rd, 2010 at 2:26 pm
Start your negotiations now. It will give you more time.
Renewing you beats a vacancy for the owner, especially if several others are leaving. And there will be no remodel expense for a new tenant by successfully keeping you as a tenant.
Ask for the same rate in exchange for staying 5 more years. That will be a hard sell, but you can “let” them talk you into $5.00. I’d be very happy to get that.
After your best shot, you can always use the direct approach. “If the rent is more than 5.50, I will have to relocate.” A 10% discount for a good customer is reasonable.