Finding the Ideal Commercial Real Estate Tenant Today

There are many properties for lease in this market in most locations. Contrary to popular opinion, that’s a good thing. It gives commercial real estate agents many properties to work with and list. The only problem that arises is finding tenants.

The value of a tenant and a quality tenant enquiry in this property market is high. Landlords want top-quality tenants who are proven operators in their chosen business type. Every potential tenant should be optimised and sourced to the correct property. So, what does a good tenant look like?

The Best Tenants

Consider the tenants that you need for every property. A lot depends on the landlord and the property, but in basic terms, you are looking for a tenant who brings stability and profile to the building. 

Given that plenty of stock is available for lease today, most tenants are taking the time to choose the right property. Every landlord needs to have an attractive rent asking and a favourable lease term. Incentives will sometimes tip the scales and help close a lease transaction for a landlord.

Leasing Discussion and Negotiation points

Here are some other ideas for what I think would help you attract a quality or ideal tenant in this market.

• A tenant that has an established history of good property occupation – talk to their previous landlord or property manager to check that detail.
• An attractive business profile for the property can potentially strengthen the overall tenant mix. Given the property type, franchise businesses are sometimes worthwhile considerations.
• The ability to pay the market rent on time and in accordance with the terms of the lease. Get some proof of tenant and business financials as well as history of operations.
• The acceptance of a market rent or rent review profile will allow market rent to be optimised in the lease term.
• A reasonable bank guarantee or bond for the landlord to retain for the term of the lease as protection against tenant default
• A make-good provision that removes the fit out for the current tenant at the end of the lease term.
• It is questionable whether an option is good or bad; it really depends on the property and the landlord.
• Given the property’s services and amenities, the tenant’s business operation should function conveniently and comfortably. The lease should define the permitted and legal use of the property.
• Car parking and locational factors should work for the tenant.
• Improvements in the property are well-matched to the tenant.
• Permitted use and zoning allowances for the property suit the tenant and the use of the property.
• Recoverable outgoings are achieved for the landlord through lease terms and conditions with the tenant.

You can probably add to this list based on the property type and the location. The important thing is that the tenant is vetted and qualified for the property. The landlord’s lease terms and conditions should be built into a well-structured standard lease.

When you find a suitable tenant prospect, ensure every property that may suit them is identified.  It is better that you get the commission than any other agent in the local area.