The leasing of commercial and retail properties can be boosted significantly by following some simple rules. The property market will always have properties to lease; it is simply a matter of matching tenants to properties. There are some effective strategies to do that.
So let’s look at defining the leasing status of the property market today in your town or city; in doing that we can look for opportunities and clients to serve. Property Leasing fees are always out there for the astute and active real estate agent.
You really must understand what is happening to get any traction in leasing vacant premises. You can drive some real and solid commissions from knowing your local tenants and landlords. To do that correctly, try answering these questions:
- What is the vacancy factor as it relates to your property type and zone?
- How much space is available to lease today in the locations that you operate as an agent?
- Consider the vacancy lease times of the grades of property. For example in the case of office premises that would be in the categories of New, Prime, A grade, B grade, and C grade leasing stock.
- How much new lettable space is coming into the market through new developments in the next 18 months?
- How long does it take for premises to lease? That is the time on market factor.
- What are tenants looking for in leasing any premises? That will include services, amenities, improvements, and fitout.
- What are ‘market rents’ doing for the property type? Track those changes over the last few years leading up to today. Take into account the variables of gross and net rent. Understand what works for the property type and location.
- What incentives are being offered to lease property today? Some tenants will always ask for an incentive to do a lease deal, regardless of the market conditions. On that basis the landlord has to be fully briefed on the ‘incentive status’ of the local property market. If an incentive is to be provided, build the cost back into the cash flow from the rental over the lease term.
- What are the franchise groups looking for by way of premises and locations for new businesses? As part of that investigation find out what the typical lease terms should be in each case to match the terms of the prevailing franchise agreements.
It is no secret that the property leasing market was impacted a few years ago by business sentiment and the economic outcomes of the GFC, however that is all ‘old news’. Those businesses and enterprises that are active today, want to improve, grow, and thrive. That is where the skills of a local property leasing agent are very valuable. Office leasing, Industrial leasing, and Retail Shop leasing all offer opportunities.
Information from the market will help you lock into those tenants and businesses that are looking to improve. The property market is either tenant or landlord biased; new leasing standards can be set for your property services. When you look at things in that simple way you can see that the following rules apply:
- Get to know all the tenants and their premises requirements in your local area. To do that you will have to make lots of telephone calls into the business community (use the business telephone book and the internet to do that). It is easy to do the calls as you are simply seeing if you can help a tenant expand, contract, or relocate. Leases always come to an end.
- Get to know all the landlords that own and run investment property. Properties with multiple tenants in occupation are the best to focus on as many of the leases will be in factors of change.
- Some properties need to go through renovation and refurbishment every 10 years or so. You can get a lot of leads and commissions working with those properties that need ‘investment adjustment’.
- Become a leasing specialist locally and understand all the factors of ‘tenant mix strategy and adjustment’. Provide advanced ‘tenant retention and relocation’ plans to your landlord clients.
A top property leasing agent offers a top service. They know a lot about the market and just what the tenants are doing. Your database will be a valuable resource in such investigations. Get to know all the tenants that are in your market today, and those that want to enter it.