Negotiating An Office Space lease

The relationship between landlord of
Office Space and tenant looking for Office Space can take on a similar flavor if one party or the other enjoys too much power or lacks integrity.  The broker is to make sure theOffice Space clients are able to negotiate from a position of strength, not weakness, and that strength comes from knowledge, especially in regards to Office Space..
Among other things, this means that each of the parties MUST be able
to negotiate an
Office Space lease language that will protect them should the other party
suddenly exhibit a lack of integrity.  Remember, landlords sell buildings, lease
Office Space
and tenants have changes in personnel.  The person across the
negotiating table may not be the person you will be dealing with a year
down the road regarding your
Office Space.
 
Leveling The Playing Field in Negotiating a
lease for Office Space
Before we get into the meat of the Office Space lease, negotiation process, It is important to first acknowledge a few truisms about changes that are occurring the industry of leasing Office Space.
  Third party data providers, such as CoStar, have begun to level the
playing field between
Office Space brokers and Office Space brokerage houses.
    - The large Office Space brokerage houses no longer control access to
information (i.e. space availability, lease expiration dates etc.)
to the same extent that they have in the past.
    - Office Space market knowledge and quality presentation capabilities are now
available to everyone, for a price.
    - It's just no longer possible for a broker to merely be an Office Space tour guide
and effectively compete for a client's business.

 

As a result, only Office Space brokers who offer true transactional expertise will
be able to set themselves apart from their peers.

 

The focus of negotiations in an Office Space lease transaction is usually directed
toward the issues of base rent and concessions - Let me assure you
that there are a host of other important concerns which are often
overlooked, misunderstood or under-negotiated, even by
sophisticated office space brokers,
Office Space tenants and Office Space landlords.TOP
 
Why Transactional Expertise in
Office Space Is Critical
If you are an Office Space broker, I'm sure that you have had clients who chose not to
consult an
Office Space lease attorney!  In our experience, 90% of the smaller, regional size Office Space tenants either don't consult an office space attorney or fail to seek out an attorney with real estate or Office Space leasing expertise.
How do we know that? Because they did't request prudent modifications to our Standard Office Space Form Lease!  Even more disturbing is the fact that in 8 out of 10 cases, an Office Space broker represented these same tenants and still, they were offered NO guidance on these transactional issues in their quest for Office Space !
We have spoken to countless Office Space brokers who have indicated that they will
merely counsel their clients to seek the advice of an
Office Space attorney.  They reject the notion that it is their responsibility to knowledgeably discuss or have expertise in the "other" issues of significance that surround an Office Space lease document.
Are they worried about the issue of giving a client legal advice regarding their Office Space lease?  No! 
They just don't enjoy a thorough understanding of the issues and lacking such knowledge, can only suggest that their client seek guidance elsewhere concerning their
Office Space .TOP
Conveniently, Office Space brokers are usually required to recommend that clients
have an
Office Space attorney review the Office Space lease agreement.  Somehow, many have
come to feel that this actually relieves them of any obligation or duty to
delve more deeply into the business points of the
Office Space leaseNot So!  In
today's market place, this is how
Office Space brokers can offer true value and set
themselves apart from their competition!
 
The Standard
Office Space Form Lease
If you represent an office space tenant and the landlord says, "It's our STANDARD
Office Space lease. Everyone signs it!",

STOP!   STOP!   STOP!

"Standard" does not mean right or fair to the Office Space tenant. When you consider
the potential negative effect an
Office Space lease can have on a company's bottom
line this is foolish.

  Office Space leases are usually very long, complex and often printed in very small
type.  For the most part, everyone involved in
Office Space hates to read them.  Big companies, who have their own Office Space real estate department, in-house Office Space attorneys and multiple business locations, are used to modifying office space leases to their own standards and landlords are used to negotiating those changes to the Office Space lease.  If your Office Space e client doesn't fit that profile, you're going to have to do a little work to protect their interests.
    - Essentially, an Office Space lease is much like a partnership agreement in that
it sets out the parameters of a business relationship.  When
everything goes as planned, most any
Office Space lease will serve the parties
well but the true test occurs when there are hiccups in the
relationship.
TOP
    - If the Office Space lease has not been carefully drafted, a hiccup can become
a major problem for one or the other of the parties. 
Office Space tenants often
lose sight of the fact that the "Standard Form
Lease" for Office Space represents
the landlord's wish list and if not appropriately modified, may not
serve their interests when issues arise.  On the other hand, a
sophisticated
Office Space tenant will often request changes to the Office Space lease that,
if not fully understood, can cause unforeseen difficulties for the
Office Space
landlord as well.
 
The
Office Space Acquisition Timeline - A Review
While other pages on this Website provide a detailed overview of the
entire
Office Space leasing process, reviewing the high points will provide us with a
point of reference for the discussions that follow.  The components of
a tenant's successful campaign to
lease Office Space are as follows:
    Determine Office Space Requirements / Analyze Needs
      - Location of Office Space
      - Amenity and Service Requirements for New Office Space
      - Office Space Components /Office Space Staffing Projections /Office Space Square Footage
Requirements
    Survey Office Space Market
      - Selection of Qualified Office Space Properties
      - Location of New Office Space
      - Amenities and Services required in new Office Space
      - History of Current Office Space Landlord
    Technical Office Space Property Review / Physical Tour
    Office Space Proposal Process TOP
      - Prepare the Request for the Office Space Proposal (RFP)
      - Distribute the RFP to Qualified Candidate Office Space Buildings
      - Review Office Space Proposals (landlord responses) and preliminary
space plans
      - Evaluate Office Space Offers and prepare the Comparative Office Space Lease Analysis
      - Background Report on Owner Performance, Office Space Tenant Satisfaction
      - Technical and Location Data is Reviewed for Office Space
    Negotiations for Office Space
      - Office Space Negotiation Checklist
      - Solicit Input from Office Space Legal Counsel
      - Implementation of Office Space Tenant Resources
      - Mutual Execution of Office Space Lease Document
    Planning for New Office Space / Permitting for Office Space / Construction (if applicable)for new Office Space
 
The
Office Space Request For Proposal (RFP)
The negotiation process for Office Space begins with a comprehensive RFP.  The actual RFP can only be developed after the Office Space tenant has developed a thorough understanding of its Office Space needs and qualified Office Space properties have been identified. As such, the Office Space property tour has taken place and optimally, at least three suitable Office Space properties have been identified.
In an Office Space sale transaction, this is the point when an offer would normally be
submitted.  In the process of acquiring
leased Office Space, the offer for the Office Space is
replaced by an RFP.  The really fun part is that, unlike offers to purchase office space, RFP's can be submitted to multiple
Office Space properties at the same time because the Office Space tenant is merely soliciting a proposal from the Office Space landlord.  This should be thought of as the Office Space tenant's wish list and becomes a critical component of the negotiation for Office Space
  The Office Space landlord responses will give the office space tenant a great deal of Office Space market
knowledge.
TOP
  A competitive atmosphere will have been created between Office Space landlords.
  At least one Office Space property will usually express a profound desire to
consummate the transaction and when this occurs, the
Office Space tenant's
negotiating position is strengthened.
  Negotiations for Office Space that have been well documented in the RFP - which I
will explain later in more detail - can help establish the intent of the
Office Space
parties in any future dispute.
  Always, always. request a copy of the Office Space Standard Form Lease!
Repeat, an important component of the RFP is to request a copy of the Office Space
landlord's
Office Space Standard Form Lease agreement.  This document should be
thought of as the
Office Space landlord's wish list, which is subject to revision in a
variety of important respects.  After its thorough review, subsequent
submissions of the RFP (we'll talk about this in more detail in just a
moment) can incorporate the
Office Space tenant's requested modifications as well
as any suggested addendum language.
Other considerations when developing the RFP for Office Space include:
  Speak to ALL of the Office Space tenant's needs and core requirements. Included
are such things as
Office Space expansion (i.e. right of first refusal), office space renewal options, etc.  It is much more difficult and many times impossible to obtain the optimum result when an important consideration is put on the table late in the negotiations for the Office Space
  Insert legitimate items that are "throw away issues" for the Office Space tenant and
define the other areas of flexibility prior to the start negotiation. 
Similarly, most
Office Space landlords will have predetermined fallback positions
for many
Office Space lease clauses and the desirability of the Office Space tenant will dictate
their willingness to make modifications or deletions in their
Office Space standard
form
lease.TOP
  The content of the RFP should be consistent with Office Space market conditions and take into account what is attainable by this particular Office Space tenant in the current Office Space marketplace.  (I.e. larger requirements with fortune 500 credit will normally be able to ask for more than a smaller Office Space (tenant with local credit).  It is, of course, necessary to push the boundaries as a strategy in the office space negotiation but the Office Space tenant's requests for concessions should not't be viewed as outlandish by the Office Space landlord unless it is a very strong Office Space tenant market (i.e. high vacancy / low absorption).
The Office Space Landlord's Response
Often, the Office Space tenant will have presented something like a thirty point RFP and will receive a nine-point response in return.  While there may be inadvertent omissions, at other times it will be by design in that the Office Space landlord just does not't want to address the issue, such as when a response would put the Office Space building a competitive disadvantage.
As a result, it is important to employ a simple and effective method for an Office Space tenant and/or theOffice Space tenant's broker to track the progress made on deal points while also making sure that all the original points outlined in the RFP eventually get addressed.  So, here is where we get to the part about the well-documented Office Space negotiation that I touched on earlier. One method that we have found to be effective is illustrated below.  It has the added benefit of also documenting the Office Space negotiation. This is particularly useful in any instance where it becomes important to fully understand the intent of the Office Space parties, such as when an office space attorney is asked to draft lease language accurately reflecting the office space negotiated business points of the transaction. Again, documenting the intent of the Office Space parties can also prove useful if a dispute develops during the term of the Office Space lease.
When the Office Space landlord's proposal (response to the RFP) is received, insert the response made to each point for the Office Space , word for word using bold face type, directly under the original corresponding point in the RFP.  The use of bold face type helps to distinguish the Office Space landlord's responses. Under any original Office Space point in the RFP which has failed to elicit a response from the Office Space landlord, the Office Space tenant should note in bold letters "No Response Received".  The Office Space tenant then adds his further responses (or indication of acceptance) just below the Office Space landlord's bolded responses, once again using regular type, and returns the document to the office space landlord for his review.TOP
    Tip - Many offices and Office Space now have some sort of scanner and optical recognition software which will allow you to easily cut and past the Office Space landlord's response into the original RFP.
A clean and simple procedure.  The Office Space tenant's request .Office Space landlord's response . Office Space tenant's response or indication of acceptance .Office Space landlord's further response or indication of acceptance. The alternating standard/bold and No Response format continues until a consensus has been reached on each deal point. Refer to the sample

Corporate Identification:

for your Office Space

Please state how the Office Space building could accommodate corporate identification and signage and address responsibility for the costs of such identification. Please include information pertaining to any municipal codes affecting signage on your Office Space building.
The Office Space landlord will provide, at no cost to the Office Space tenant, one (1) listing in the Office Space building directory located in the lobby and one (1)Office Space building standard sign on the wall adjacent to the front entry door of the Office Space identifying the Office Space tenant and Office Space number.  A limited number of additional listings can be made available in the Office Space building directory but the cost of said listing(s) would be the responsibility of the Office Space tenant.  There is no exterior building signage available.
TOP Accepted

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