What is so complicated about negotiating a commercial real estate deal?
A. The ‘deal’ is in the details. Just as in accounting and law, commercial real estate transactions are made up of many seemingly small, but interrelated details. This is especially true of commercial lease transactions, where the ‘effective’ rate a tenant pays is comprised of the ‘contract’ rate less a myriad of offsetting reductions (i.e., ‘concessions’ such as a period of full or partially abated rent, landlord provided tenant improvement allowance, fixturization period, reduced charges for covered parking, moving allowance, and many others.) The failure to recognize and negotiate any of these concessions can, over the life of a typical lease, cost a business thousands of dollars in excess rent. Remember, once your lease terms and conditions have been negotiated and the lease is signed, you must live with whatever is contained within the document. Do not make the mistake of trusting these negotiations to well-meaning, but inexperienced staff members or brokers who primarily make the
