Looking for and paying for a commercial property can be daunting and expensive. You want to know if you’re getting a good deal, if the deal you have is good, and how you can make it even better. This is true whether you are an industrial business, retail, medical, or even a traditional office space. To help you keep more of your money, we will show you 4 ways to save money on business rent.
1. It All Starts With Research
One of the first steps is to look up rentals for business in your area or desired areas. How much is the average rent, the average for square foot, and what amenities do the rentals offer? You can come up with an average and see how your current lease measures up. Talk to the other tenants and see if rates have been renegotiated. Is the landlord reasonable? You may also come up with some bargaining chips such as signing a longer lease, willing to move to another location in the building, early payments, and other incentives.
Did you know that the average listing for office space is $37.78 per square foot in the United States for 2023? Source: Commercial Edge
2. Develop a Plan
Come up with a detailed plan containing your most desired solutions first to last. For example, your business rental plan may look something like:
- Renegotiate current rent at a 3% discount.
- Will accept a current rent reduction at 1%.
- Rent office in current building at $X per month for X months.
- Offer to rent office in another building owned by landlord at $X per month for X months.
- Rent 1st choice property at $X per month for X months.
- Or rent 2nd choice property at $X per month for X months.
- Or rent 3rd choice property at $X per month for X months.
- Look into purchasing office space.
3. Get a Specialized Real Estate Agent
Your first choice may be to renegotiate your current rent rate or get another space in the building. When those choices fall through, it is time to get a specialized business real estate agent. They work much like residential real estate agent. Your agent will listen to your needs, budget, desired location, and more. They are then paid through a commission which may be based on a percentage.
Did you know that the average Houston business rental costs $31.04 per square foot, and $3694 per square foot for Class A (high quality) in 2023? – Source: Statista
4. Read New Lease in Detail
You will be asked to sign a new lease no matter what option you take above. The first draft of your commercial lease agreement may greatly favor your landlord. Utilize your real estate agent at this time to get the best deal possible. Be open to reasonable propositions, but also be ready to walk away if the terms are too unfavorable.
More Ways to Save Money on Business Rent
Unfortunately, business rent is must in these times. However, a bookkeeper can help by helping you realize if your budget devotes too much to business rent. They may even be able to help you find other ways to reduce this cost. Feel free to contact us if you live in Houston or the surrounding areas and want help balancing your budget.