A landlord’s effective rental rate will end up being their net profit level from the lease before the building payments are made on a square foot basis. If it is viewed from a landlord’s perspective, it is easier to understand their prospective return on investment and how the different aspects of the lease affect their bottom line. No two leases with the same payments will land the same return of profit to the landlord. Evaluating the landlord’s effective rate during negotiations is a tool that holds massive importance in determining the landlord’s bottom line and profit. Effective rental rates are what bring negotiations to a finish or an end. There’s no getting around them, and this detailed tool used by the right professional will ensure that. Brokers are well versed on this subject.
USE ALL OF THIS TO TELL THE PROSPECTIVE L ECTIVE LANDLORD WHERE RD WHERE THEY NEED TO BE MORE COMPETITIVE. TITIVE.
The first proposal will not represent where the negotiations will end up or even go with the landlord. They are only meant to provide an insight into the relative cost of each option. Since this is hard data, there’s no getting around it (besides some of the qualitative aspects).
DOWN THE LINE, THE LANDLORD WON'T BE AGGRESSIVE WITH Y IVE WITH YOUR PROPOSAL UNLESS POSAL UNLESS THEY THINK THERE IS A REAL SHOT OF LANDING YOU AS A TENANT.
So your first act of communication after your analysis results is just to open up negotiations and start the process. It will usually prove that you are serious, unless you intentionally don’t start the process.
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