College Station Commercial Real Estate
This is the best time to relocate in the last 10 years, retail and office lease prices are at record low prices! Space that was previously $22-24/sf is now $12-16/sf. If your current lease has a high priced extension or if your location isn’t as good as you would like it to be, it is time to move! We have an intimate knowledge of 99% of locations in the College Station Commercial Real Estate market, but we don’t represent the Landlord we represent the tenant. We want to use our experience to help office and retail tenants get the deals they need to grow their business in this economic period. Not only do we know about all of the great deals out there, but the fine print contained in 35 page commercial leases is crucially important to your bottom line. There are many things that aren’t mentioned in the initial Letter Of Intent (LOI) that are contained in the lease, such as a CAM management fee of 5-15% which can typically be negotiated out of the lease completely.
This is important, make sure you know when your lease expires and the terms you have for your notices. You should start thinking about your move 1 year before your lease expires. If it’s already time, Contact Us Today! If it’s not even close to expiring, let us know when it expires and we will remind you! (Use the form on the right)
Explanation of Commercial Real Estate and Things to Look For
1. “Triple Net” (NNN) is a term that became widely used during the economic boom, every landlord and developer started using NNN leases because it allows them to easily see what their net profits are going to be. It allows them to pass all of the carrying costs on to the Tenant, which are Taxes, Insurance, and Common Area Maintenance. They may have a few minor expenses such as management, but they will try to pass that along to the Tenant as well if they can. Times have changed and the Landlord is not in the driver’s seat anymore, you may be able to get a gross lease or maybe even a full service lease.
2. “Letter of Intent” (LOI) is the first stage of negotiations and is completely non-binding for either party, although signing it is kind of like giving your word, so unless you simply can’t do the deal it is customary not to negotiate the main points after an agreement is made via the LOI.
3. “Short Lease” is a very short 2 page lease some large Landlords(seen with REITS) try to slip in to “make things easier.” These are NEVER a good idea because they leave a lot of ambiguity on the issues and give the Landlord a lot of power.
4. “Extensions” are extremely important. They do not bind you to use them, but if you move into a space and make it your business’s home for 3-5 years and do well there, the Landlord knows it will be costly for you to move. So, if you don’t negotiate your extensions up front he can raise the rent drastically at that point and you are almost forced to agree with it. Try to get as many extensions as possible, and never accept larger than a 3% increase per year on the base rent.
5. “Notifications” often slip by and void your extension you have negotiated. The Landlord may give you good extensions but try to make you give him notice 12-24 months in advance if you want to use them. Make sure you don’t have to notify the Landlord any further than 180 days prior and go for 90 days.
6. This list could go on and on detailing all of the things to look for in a 25-60 page lease document, but my team and I are professionals at this just like you’re a professional at what you do. Our services will save you money and protect your interests.(and will not cost you anything)
7. Even if you don’t use a Tenant Rep, make sure you know when your lease expires and your notification dates. We will evaluate your current lease for free, send it over to us now, don’t wait until it’s too late.
Sincerely,
James Murr
Commercial Broker
979-739-7237