There are multiple scenarios that aren’t ideal for tenants. Maybe your industrial real estate lease is coming due for renewal in a landlord-friendly market, or you can no longer put off finding a West Coast location and you’re about to find yourself forced to navigate high rents. Solving your logistical problems may feel insurmountable when the climate favors the landlords, but the right strategy can be a game changer. Here are four tenant strategies in a landlord-friendly market.
Familiarize Yourself with Current Vacancy Rates
Dive into stats relating to local vacancy, but don’t be distracted by how these numbers apply to the market as a whole. What’s relevant is what local vacancy rates mean for you. A low vacancy doesn’t necessarily mean that the specific size you need isn’t available. You may even have your pick of properties. That’s why you need to look specifically within your size range. Make sure you’re starting with the right data, too.
Prepare to Show Well
Another savvy strategy is to prepare yourself and your firm for the impending property search and negotiation. Take stock of the basics – does your website project the right image? Do you have financial statements at the ready? To what sort of realistic lease term can you commit? Have you considered specialized tenant improvements, and can you finance them yourself if necessary? Preparing, organizing, and doing what you can to present yourself well can feel tedious, but it will pay off.
Get a Read on your Landlord
Prospective tenants are typically wildly unprepared to effectively assess landlords. This strategy requires the assistance of an experienced real estate agent. Landlords often vary when it comes to tenant preferences, and an agent with lengthy experience in the local market can be the key to matching your needs to the right landlord. That saves time, streamlines the lease process, and boosts your chances of a more successful transaction.
Don’t Make this Rookie Mistake
Experienced agents know that a large part of their job is to create maximum leverage in the transaction, which can be difficult in a landlord-friendly market. Little things – word selection, body language, a few comments dropped here and there, follow up communication with the landlord, etc., – can be classified as small talk, and it can help or hurt your leverage come negotiation time. Lease renewals in particular are challenging, since landlords are aware that the moving process is expensive and disruptive. It often gives them the upper hand, so avoid making their job easier by oversharing.
The single best tenant strategy, of course, is finding an agent you can trust. Look for someone with experience, a successful track record in the kind of industrial real estate you need, and follow these tips to set them up to do the best job possible – no matter how unbalanced the market.