REAL ESTATE
shopping centre or other multitenant location leases require
tenants to pay a contribution
for promotions, building
improvements, management
costs and security costs in
addition to rent and outgoings.
considerable increase in the
valuation of the property or
capital gain since the existing
landlord purchased it, you may
also find the new landlord will
quickly increase the rent to cover
their new purchase cost.
The rent may also be or
include a percentage of the
tenant’s takings, with rigorous
requirements for book-keeping.
One very successful local
business in my suburb had been
operating in the same location
for 25 years, but with the end of
his lease nearing faced a 600%
increase in rent after the sale of
the building where his business
was located, so he had no
choice but to close up or move
elsewhere.
Is the building for sale?
Building owners looking to sell
their building will have different
motivations with prospective
tenants. If there has been a
22 ModernBusiness
February 2016
Also, consider that you may like
the current landlord but dislike
the new landlord.
You may feel uncomfortable
asking these questions; however,
real estate agents and property
managers are typically open to
providing answers.
As a commercial tenant, you
have every right to know
the entire picture. I strongly
recommend that you type out
these questions as a worksheet
and refer to them before
negotiating or renegotiating
begins.