If you are looking into leasing a commercial office, but the space does not exactly fit what you had in mind, you can ask for a tenant improvement allowance. This will allow you to improve the space with money from the owner, enhancing things like flooring, paint colors and window dressings. However, most renters don't realize that they can negotiate the amount of the tenant improvement allowance. Here are some tips to get the most money possible when it comes to a tenant improvement allowance.
Sign a Long Lease
One of the things that you can do to help get more money for the tenant improvement allowance is to sign a long lease. A landlord or building owner is more likely to give a tenant who signs a longer lease more money than someone who signs a short lease. They want to the tenant to be happy with them and they have the ability to make more and absorb the cost of the tenant improvement allowance. Of course, there is no hard and fast rule to how much money you can get per year, as it varies based on the landlord, types of upgrades you want to do and rental price in the area, but generally speaking, you can get negotiate a higher amount signing a longer lease.
Ask for Upgrades that Increase their Building Value
Another factor to consider when negotiating the tenant improvement allowance is improvements that will increase the value of their building. A building owner is unlikely to get much value if you slat wall a building. However, if the flooring is old and worn, their value may increase with decent flooring installed. Lighting, windows, countertops and exterior painting can all potentially increase the value of a building.
Have Quotes From Other Companies
The last tip for negotiating a higher tenant improvement allowance is to have quotes from other companies or landlords who have commercial office spaces for lease. If you explain how much one company or landlord is prepared to give to you and can show it, you may force the landlords hand in offering you more money. This is a great tactic, as it helps to show that you can get a better deal elsewhere. However, the location and building specs should be similiar or the landlord may not be swayed.
Getting a tenant improvement allowance can help you to finish an unbuilt space and turn it into exactly what you want, or take a finished place and upgrade it so it fits the needs of your business. Learning how to negotiate a higher tenant improvement allowance will help you maximize the amount of money you may be able to get.