Preparing for a Commercial Lease Negotiation
For many business owners, negotiating a commercial lease is something they only do every few years. Preparing ahead of time helps the process move smoothly — and lets you make stronger, better-informed decisions.
Because a lease negotiation comes around so rarely, it can be difficult to know what information landlords will request or what decisions need to be made before negotiations begin. Here is what I walk clients through before we start.
Understand your business needs
Before entering a lease negotiation, it's important to have a clear understanding of how your space supports your business. Consider:
- How much space do you truly need?
- Is your current layout working for your team and your customers?
- Are you planning to grow, hire, or add services in the coming years?
- Is your current location still the best fit for the business?
These answers shape the entire negotiation strategy.
Be ready to share business information
Landlords typically request financial and operational information before agreeing to terms. That usually includes:
- Business financial statements
- Tax returns
- Business history and ownership information
- Personal guarantees or other financial backing
- A business plan or look book, particularly for a new concept or a first location
Knowing these requirements in advance prevents delays once negotiations are underway.
Evaluate your options
Even if you fully intend to stay in your current space, it's important to understand the market. Reviewing comparable spaces tells you whether the proposed terms are competitive — and whether another opportunity is worth considering.
Start early
Starting early allows time to evaluate options, negotiate effectively, and avoid unnecessary pressure. A landlord who knows you have nowhere else to go is negotiating from a very different position than one who knows you have alternatives.
Work with a professional
Commercial leases are detailed agreements that can affect your business for years. Working with someone who understands the market and the negotiation process helps ensure the final agreement supports your long-term goals — not just this month's move-in date.
If you have a lease in front of you, or you're about to, give Leah a call. Thirty minutes on the phone before you sign is worth more than any amount of reading afterwards.