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How Far Will Landlords Go for a Deal?

SADDLE BROOK-'If we are not doing any tenant improvement work, or if there's minimal work involved, we will sometimes opt not to review the tenants financials,' says Denholtz' Hurlbut.

By Alyson Grala | Updated on April 09, 2010

SADDLE BROOK, NJ-It’s no secret that tenants have the upper hand when negotiating lease agreements and renewals, including rental rates and incentives. But how far are landlords willing to go to make a deal in the Garden State?

Landlords will be flexible with overall lease terms including rental rates in a challenging market; however, there are certain rental rate parameters that landlords must strive to maintain, as it relates to the overall value of the asset as well as landlord’s ability to sustain building services for both existing and new tenants, says locally based Greg Barkan, first vice president of CB Richard Ellis. “Aggregate rental rates could be discounted and positioned in a way to afford tenants the benefit of reduced rates in the beginning of the term, while providing the landlord with an average rate and growth over the term that is conducive for the asset,” he tells GlobeSt.com.

Barkan adds that he is not aware of landlords cutting out amenities or building services in order to come down on price. “The landlords that we represent have not taken that approach, in fact, they have been constantly revisiting potential ways to add amenities to enhance leasing efforts and attract new tenants,” he says.

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