When you understand the local market trends in commercial real estate leasing you can do a lot with finding more tenants and closing on quality lease negotiations. Leasing activity underpins property investment and hence property sales. It stands to reason that a good leasing agent is always preparing the ‘ground’ for a great sale in future years.
Fees and commissions from leasing can ‘fill in the gaps’ between property sales activities. Successful leasing deals later lead to sales opportunity. Top agents will sell and lease as a matter of providing professional services.
So let’s say that this has some attraction to you in building your real estate business. Here are some rules to help you with your listings and leases.
- Look for the new developments coming through the planning approvals office at your local council, as those developments will have an impact on supply and demand as well as rentals. Perhaps you can tap into the property owners of those new developments and get a new listing?
- The market rentals locally will be property type specific, and a location any property improvements will have something to do with rents achieved. Get to know the variations and strategies behind rentals including net rents, gross rents, incentives to be used, passing rents, together with face and effective rentals.
- Lease documentation should not be generic. Unfortunately many solicitors prepare lease documentation with a generalised approach to property occupancy. They also rarely look at the property first to understand the improvements and layout. A good property should have a lease that is drawn up for optimised occupation and rental return.
- Get to know lots of local businesses as they will be the foundation of any leasing negotiations in any properties listed. Most local businesses will change property occupation at some stage due to the requirements of expansion, contraction, or end of lease. Track all of these needs through the local area so you can grow your ‘targeted tenant list’ and close more deals over time. Your database becomes a valuable tool in putting a lease negotiation together.
- Keep in contact with all the local ‘franchise groups and tenants’ as they will have factors of property change or leasing. Most franchise groups have a form of lease that suits their business operations and franchise agreement. Get to know their form of lease an how they like to occupy property.
These factors will help you understand the market trends for your town or city in leasing. Track the trends and open up the opportunities.