When you are leasing commercial property to a tenant, there are a few good principles to follow in the sales pitch about the premises and in the process of negotiating leasing. These principles apply with both office and industrial premises.

At the outset remember that the inspection and the pitch is all about the tenant and the premises; it has nothing to do with you. You are only the facilitator to the deal. All comments and questions should focus on the tenant and their needs.

Remove your ideas of more commission and closing another deal immediately. Start to focus on the tenant and the benefits they can get from the property. You should know the property and the location better than the tenant so you can do something with that knowledge.

Here are some ideas to introduce to the inspection and negotiations:

How would the tenant and the business operate from the new location?

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When you work in commercial real estate sales and leasing, the territory in which you operate should be your focus to achieve market domination and penetration. This means that you need to get your fair market share (or better) of the quality listings and real estate market activity.

Competition in commercial real estate is always fierce and competitive. Real estate agents and brokers will chase each other’s listings, although this is not the best way to dominate the market. Ideally you should be finding and attracting the best listings before they go to other agencies. This is called territory domination. To have the first opportunity to list the property before other agencies know of the property is ideal.

So planning your sales territory and territory domination is critical to the agency and your personal success. To do this there are some key issues to consider and research. Your diligence here will significantly impact the outcome. The key factors and trends to help you plan and dominate your sales territory are:

Property ownership throughout the territory is an ongoing fact of research, contact and networking. You simply need to know who owns what and how to contact them. Establishing relationships with the key property owners is a major part of the process.

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When it comes to investment property, retail shops and shopping centres remain special and unique. The tenants that are chosen for the property and the tenancy mix will have significant impact on property cash flow. On that basis you need the right tenants and you need to put them on the correct lease given the landlords plans and targets.

Property managers and leasing managers working with retail property should have a constant focus on:

New tenancy placement
Vacancy minimisation
Tenancy mix strategy and analysis
Rent optimisation

Most retail properties will have some form of vacancy factor throughout the financial year. The key issue is to minimise that vacancy impact for the property owner or landlord, as every vacancy will bring with it associated problems and costs such as:

Loss of rental for the term of vacancy
Lots of recovery of outgoings
The stigma associated with the appearance of the vacant space
Costs associated with new lease documentation (such as legal fees and or documentation costs)
Cost to the landlord regards remediation and reinstatement of the premises for a new tenant
Costs of incentive in any new lease
Commissions associated with finding a new tenant

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