Relocating a business is like moving a piano. You have to really want that piano somewhere else. You don’t just move a piano on a whim. It’s expensive, time-consuming, and stressful. Still, there are times when the benefits of the move will outweigh that.
Commercial landlords know that their tenants need a pretty compelling reason before they will voluntarily relocate. That’s one of the attitudes that bring into any renewal negotiation. The fact that tenants tend to prefer staying put is an advantage to the landlord. And unless the landlord feels that the renewal is in some doubt, it can be difficult for tenants to negotiate favorable terms.
So if the landlord does not believe you’re moving, you’ve lost some leverage. There are 5 common reasons that this can occur. Avoiding them can put you in a much stronger negotiating position.
1. Experience tells the landlord that you’re unlikely to move.
This happens in less than half of all renewal situations, so the landlord will feel confident, until given reason to feel otherwise.
2. There is not enough time for you to possibly plan and execute a move before the lease expires.
If it’s business as usual at your place and there’s no sign of preparations, the landlord will assume there’s no plan to move. It takes months to plan and implement a move. Depending on the size of the operation, it’s wise to allow 6 months at the bare minimum.
You can prevent this situation by opening renewal negotiations well in advance of the lease’s expiration. Start talking about renewal terms early enough that the landlord will not have an idea one way or another about your plans.
3. You have not consulted with any professionals about your renewal options.
Working with a tenant representative indicates your intention to examine the pros and cons of renewal. A landlord negotiates leases on a daily basis; this is not something that you can handle well while you also run your own business. When the landlord sees that you have professional help, he’s forced to step up his game and consider the possibility that you may relocate given unsatisfactory terms.
4. You have not looked into alternative properties.
One sure way to make a landlord sit up and take notice is to present a list of alternative properties that you’re basing your rent expectations on. This creates the sense that the landlord is competing for your tenancy.
5. The landlord is familiar with the amount of time and expense that go into a commercial move.
Knowing how much effort a move requires, your landlord may assume that unless you’ve expressed some dissatisfaction with the property, a renewal is inevitable.
If your landlord needs some convincing in order to believe that you’re considering relocation, use some of the suggestions above. Signal your intentions, allowing plenty of time to actually follow through if the renewal negotiations don’t go as you’d like for them to. This can give you a little more leverage in negotiating for the terms and rates that you need.