Marriage Guidance for Commercial Landlords and Tenants

It’s hard not to let emotions run high when negotiating top level commercial leases.

A lot is at stake for both landlords and tenants. Naturally, the property owner is compelled to get the best financial deal possible to gain the return on their investment they need.

Likewise the commercial tenant must be committed to ensuring the place they lease meets the needs of their culture, their brand, and has terms and conditions they can both afford and live with.

Sometimes what can look like a win-win situation can turn sour when emotions run too high.

I recently dealt with a client with a high profile business looking for new premises in the CBD. A property became vacant that looked ideal. We had got a long way down the negotiation process. The client had shared a lot about the needs of their business culture and what they needed in a building. The landlord was on board and saw a way the building could be fitted out to meet the tenants’ needs and was confident the tenant was financial secure and ready to lock into a long term lease.
You could say the deal was well on the way down the aisle to tie the knot.

But then the landlord had second thoughts. He decided he could squeeze more out of the deal. The potential tenant spat the dummy at being thwarted at the last minute and was hugely annoyed that they had been acting in good faith.

The deal is still in a prolonged negotiation state. And as with a marriage, a lot of give and take, listening and talking clearly, will provide the solution.

Building a long term relationship with patience will reap benefits for both the tenant and the landlord.