Considerations When Negotiating A Commercial Lease

A landlord and a tenant generally have opposing objectives when negotiating a new commercial lease.

A landlord usually seeks the highest rent achievable, plus the tenant paying all costs for running the building. Conversely, a tenant usually prefers the lowest possible rent, plus the landlord covering costs for running the building.

Inevitably there is a compromise between competing requirements of landlord and tenant, or there is no lease.

Present market conditions favour a tenant, meaning landlords are willing to accept less rent and more costs, in order to obtain a good tenant. If a tenant can secure a good long-term deal now, that tenant may be in good shape when space becomes expensive again.