Over and over I see companies and business owners simply print & sign an office space lease renewal agreement given to them by the landlord without even having read it. By not taking your office lease renewal seriously you risk leaving a lot of money on the table. Below are 3 tips to consider before you sign that amendment.
1. Read you original lease first – Most people don’t really read their office lease in the beginning so there is probably a good chance they won’t during the renewal process either. This is simply not the smartest thing to do. You should always read the original lease before signing your office lease renewal amendment. You want to look out for things such as certain rights that you might be losing such as right of first offer for new space or renewal option rights. Or maybe check out what your base year and parking rates are. There are things that you may want to renegotiate.
2. Reset the base year – this is often overlooked when renewing an office lease. If you signed your initial lease 5 years ago then your original base year was set at that time. Chances are pretty good that the taxes, insurance & maintenance costs have increased since that time so you want to make sure you establish a new base year.
3. Know market rental rates – Before signing that renewal agreement make sure the lease rate is consistent with what other landlords are getting out there. Research and compare at least 3 comparable buildings (space, lease rates, amenities, location) and make sure you are comparing them apples to apples. Some landlords quote lease rates differently so you want to make sure you ask what all is included in each and consider all costs during your comparison.