Are you a prospective commercial tenant and business-owner in an increasingly competitive and rapidly changing industry? You're not alone - many commercial tenants are veering towards more flexibility within their leases.
Indeed, a recent study conducted by the Tenant Representation Services found that this consideration was reasonably or critically significant to an overwhelming 90% of respondents.
There are already many considerations which fuel negotiations over a lease - rental value, location and what would be a sufficient, yet safe, length of term. The "what ifs" can be exhausting! A flexible lease affords some adaptability to tenant's individual concerns and can include the insertion of a break-clause to limit liability for rental or the option to downsize the rental space.
Results of the study revealed that close to 60% of tenants would pay a premium cost for each of these options to be included. Similarly 68% of tenants were even happy to forgo incentives in return for a shorter term with greater flexibility to renew.
They're interesting results and indicate that the future of leases may lay in more flexible, pro-tenant, negotiations. Given the current economic climate, this safety net may give potential Commercial Tenants more of a nudge than ever into taking the plunge and investing.
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