Shot Term Vs. Long Term Kansas City Office Space Leases
It’s a well-known commercial real estate fact that landlords and agents typically want tenants to sign for a longer lease, but from a tenant’s perspective, short term leases are preferable. However, there are a few disadvantages to this conventional wisdom, as suggested in the article “Negotiating the Renewal Option”:
- A short term lease means that the tenant loses negotiation leverage and often receives fewer concessions.
- Often landlords are less willing to provide funding for improvements if the tenant only has a short term lease.
- Tenant with the short term lease could potentially have to deal with higher rental rates in the future if they have to renegotiate for each renewal term.
Unfortunately, favorable renewal terms often depend on the flexibility of the landlord, which can’t always be counted on. A long-term lease might save the business money over time, but must be weighed against the risks of staying in one space for several years. It is important to spend a lot of time on the topic of these terms and renewals when you’re researching commercial rental space and in your actual lease negotiations.