Compare today''s commercial real estate market to that of the 1980s. Aggressive lending in the early 80's led to overbuilding. A conglomeration of circumstances (the largest being the 1986 tax act) led to a collapse in the commercial real estate market - a collapse that lasted over TEN YEARS! There are numerous comparisons to the current market. The short story is this: Overlending, overbuilding, soft economy, tight credit, uncertain tax future have all conspired to drive the commercial real estate market into a near collapse.
However, note the silver lining. Real estate represents wealth in the true economic sense. While the investors and developers may bankrupt, the property still exists and has its intrinsic utility. Renters reap the rewards - if they prepare, plan and act. If you are a commercial renter, take a survey of the available property suitable for your requirements. If property is available, (I am betting it is) start now renegotiating your lease. If you have five years or less on your existing lease agreement you are in a position to renegotiate. If you have two years or less, you are in control. Don''t wait until your lease expires and try to negotiate then. Start NOW.
Most renters expect their lease to increase or, at best, remain constant as they enter a new term. Turn that upside down in this economy. This is the best chance you will ever get to demand better terms.
What should you ask for? Whatever you want! For example, contact your landlord and tell him that your lease expires in eighteen months. Tell him you would like to stay but there are better deals out there. Agree to enter a five-year lease immediately if he will reduce the rate by 25%. Or maybe, demand a remodel of the property, or a different space. Anything you want is an option because options abound when vacancies are on the rise.
If you are uncertain about when and how to renegotiate your lease, Yes - we do that too. Call or email! There is nothing to lose.