Property owners and developers here in Orange County could find themselves hunting for renters at times. During these times, landlords could need to “sweeten the pot” in order to keep their properties full. This often means making concessions to a prospective commercial tenant.
Property owners can offer some common incentives to draw in a tenant. Providing a higher allowance for improvements could be enough to convince someone to sign a lease. Increasing this allowance anywhere from $20 to $50 per square foot could provide an attractive incentive.
Another way would be to offer a month or more of free rent. This type of incentive does not have to take effect in the first few months of a lease, however. It could occur after six months of on-time payments or near the end of the lease. When this type of concession would take place is a point for negotiation between the parties.
Other concessions could include a move-in allowance, the right to sublet the space or a shorter lease period. Another area where landlords could give prospective tenants a break is in fees. For example, providing free internet, parking permits or other costly amenities for a defined period may help a tenant make the decision to sign a lease.
Regardless of what type of concession an Orange County property owner is willing to make to a potential commercial tenant, everyone involved will still want to ensure they do not give up too much in a deal. It is still imperative to protect the property owner’s rights and not “give away the farm,” so to speak. Careful negotiations could result in a mutually beneficial arrangement that will end up benefiting both parties over the long-term even with the addition of certain incentives that do cost the landlord in the short term.