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Renew or Relocate? There Are Many Factors That Go into That Decision.

August 19, 2021

Before you make the decision to renew or relocate you want to make sure you understand all the options in your current lease. Leases can be complicated, so this would be an ideal time to engage the services of a tenant-only advisor. They can break down your options and work with you to determine if it makes sense to renew or relocate. Having a tenant-only advisor representing you will let the landlord know that you are serious about finding the best deal.

You will also need to start earlysometimes really early. Most leases require a 6-12 month notice if you intend to renew. Miss that window and you may be scrambling to find new office space. Landlords are also making their plans early and your space may already be earmarked for someone else. So, if you do not give notice per your lease, you will lose your renewal right and all of your leverage for negotiations. If you are having an advisor engaging with the landlord they may be able to get valuable insight on the landlord’s future plans for your space.

Does it make sense to stay?

  • If you have a favorable renewal rate and the current space is still working well for you, then you might want to stay where you are.
  • If you are sure you want to stay but are not sure your renewal rate is favorable, you will want to engage the services of a tenant-only representative and have them do a market analysis. You may find a property that suits you better and has more favorable terms. At a minimum you will know whether you are getting a fair deal from your current landlord.
  • If you are happy with your current location, but it doesn’t meet your space needs anymore, you will want to begin talks with your landlord early. Your landlord most likely wants to work with you, but it will take some time. Unfortunately, your needs don’t always fit into the landlord’s plan for the building, so you will need ample time to find a new location if your future needs can’t be accommodated.
  • A short-term lease might be an option if you missed your renewal date and you are unsure of your future needs. Again, it all depends on the landlord’s future plans for your space.

Does it make sense to relocate?

  • The market has changed since you signed your lease, and you feel the renewal terms may not be in your favor. Of course, the best way to determine this is to work with a tenant-only advisor who is an expert in your market.
  • Sometimes it’s not up to you. If you do not have a renewal right and the landlord has plans for your space, you may have no choice but to leave at the end of your term.
  • Does your current space still meet your needs? Will it meet your future needs? If the building won’t be able to accommodate your needs, you may need to consider moving.
  • A dated property with aging systems and little to no amenities, plus a landlord that has no immediate plans to upgrade the building is often a good reason to look elsewhere.
  • Your landlord is unreasonable.
  • You are not in your ideal location. For some, even a great deal isn’t enough to stay.

Deciding whether to relocate or renew your lease is best made when you are prepared with market knowledge. A tenant-only advisor can do the heavy lifting for you by analyzing your current lease, completing a thorough market analysis, and will be able to negotiate the best deal.

All ITRA Global exclusively represent tenants and provide principal-level expertise that is based on transparency, integrity, and trust. With members throughout the world, ITRA Global is uniquely positioned to meet all your real estate advisory needs.

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