Landlords realize that the corporate decision makers rarely have the time to research adequately the market in order to accumulate the knowledge required to negotiate effectively their office leases. Landlords know that if a prospect is working without representation, then the prospect is probably only going to take the time to check on one or two buildings. The result is usually a higher initial quoted rent, higher final rent, and less favorable results on the myriad of other terms of the lease.
In one case, a client of our firm hired a new executive and instructed him to handle the expansion of a division office. After receiving a full proposal from the landlord, he discovered his company’s relationship with our firm and asked us to take over the task. In our first conversation, the landlord lowered the rent by $5.00 per rentable square foot and eventually lowered it by $9.00 per RSF (over a four year term). We were also able to reduce our client’s term by a year, and lock in both an early cancellation clause and a very favorable renewal rate.
aka Project Leasing
The Newberry Company does its homework with every project leasing assignment it accepts. Our agents quickly learn the details for every vacant space both for our project and for the competition in the market. This increases our ability to answer prospects’ questions quickly and to respond knowledgeably when they try to use another available property to negotiate against us.
Adherence to this process helped The Newberry Company take a 200,000 SF office warehouse project from 28% to 96% occupancy in less than a year. The increased occupancy allowed the client to sell the project for a premium price. Another client hired us to lease its declining multi-tenant office building. The Newberry Company successfully increased the occupancy during a down market from 51% to 88% which allowed the client to favorably renegotiate the terms of its loan.
In order to be confident that a buyer gets the best overall result, it is imperative to perform thorough research on all possible opportunities. In the majority of assignments, this research uncovers negative aspects of the target property, other viable options, and/or information that helps in the negotiation. It also can provide confidentiality of the buyer’s identity when needed.
The Newberry Company utilizes the same approach when representing buyers as it does when representing tenants. The approach of knowing the competition as well as the client’s property allowed The Newberry Company to ask – and get – a sales price of 150% of appraised value on seven acres of land in southern Tarrant County