You're negotiating a commercial real estate deal. How do you secure the best terms for your client?

Understanding the current commercial real estate market is essential for CFOs in accounting to ensure they are making informed decisions that align with the financial goals and health of their company. By staying up-to-date with market trends and leveraging relationships, CFOs can negotiate deals that minimize tax liabilities and maximize deductions. Effective communication and detailed analysis of the deal's terms can also lead to more favorable outcomes for the company's balance sheet and profit and loss statements.

You must understand the market conditions and be able to project how the market will appreciate in value over the years. Focus on job growth in the area. This drives population growth and a higher demand for living spaces.

In the office market today, there is no market rent. Landlords are leaving their pre-Covid asking rents unchanged (or withheld) while the flood of subleases are competing lower and lower to try and secure one of the small number of active requirements. Every negotiation today neds to be a price discovery negotiation. Comps and “market rate” are meaningless in this moment.

O mercado imobiliário está em expansão. No entanto, nem todas as oportunidades disponíveis são viáveis financeiramente seja para investir, seja para dispor. Cabe um estudo detalhado de localização e um planejamento de investimento que obtenha rentabilidade no prazo mais curto possível.

To negotiate effectively in the commercial real estate market, it’s essential to gather data on lease rates, property values, and vacancy rates. This knowledge empowers you to advocate for favorable terms for your client. For tenants in areas with high vacancy, emphasize the opportunity to secure lower rents. On the other hand, if representing landlords in a competitive market, leverage the demand to justify higher rates and stricter lease agreements. Building strong relationships and fostering trust with all parties can create mutually beneficial outcomes. Focus on transparency and fair dealings to enhance your reputation and influence in the industry.

When negotiating a contract/lease- it is always helpful to know the terms of a similar transaction in the same market. So in other words, find out what your competition is quoting in rents, term, and TI.

I would base your goals on the underwriting and the long-term business plan for the property. This will help you focus on the terms that matter most in the negotiation.For example, negotiating a better price for certainty of closure. Another example is requesting extension periods prior to closure for more hard money down.

When I had a client who required flexibility in their lease, I realized the importance of setting clear goals before negotiations began. We outlined their must-haves, like a shorter lease term with renewal options, and agreed on what they were willing to compromise on. This approach ensured that every move I made during the negotiation process was aligned with achieving their objectives, ultimately securing the best outcome for them.

Understanding your client's objectives is vital for successful negotiations. Start by asking open-ended questions to uncover their priorities, whether they seek stability through a long-term lease or require flexibility for changing needs. Discuss potential tenant improvements and how these can enhance their experience in the space. By aligning your negotiation strategy with their goals, you can ensure that every discussion focuses on what truly matters. This approach fosters trust and collaboration, allowing you to navigate negotiations effectively and achieve outcomes that satisfy both parties. Keeping communication clear and transparent will also strengthen your relationship and lead to mutual success.

When negotiating a commercial real estate deal, setting clear goals is essential to securing the best terms for your client. Start by defining the primary objectives, such as desired lease terms, rental rates, or purchase price. Identify any non-negotiable requirements and preferred outcomes to guide the negotiation process. Establish measurable criteria for success, including budget constraints, location preferences, and desired amenities. Align these goals with your client's strategic interests and financial capabilities to ensure the deal supports their long-term objectives. Clear, well-defined goals help streamline negotiations, facilitate informed decision-making, and ultimately achieve the most favorable terms for your client.

Relationships are very important for establishing trust. Often, if a successful transaction occurs between two parties, they will do business again in the future.

Building strong relationships in commercial real estate is essential. Focus on nurturing connections with brokers, property managers, and other industry professionals. This network can provide valuable insights that enhance your client's position. When engaging with opposing parties, prioritize open communication. Understanding their motivations can foster cooperation, leading to more favorable negotiations. Strive for win-win outcomes, as this approach often yields better results than confrontational tactics. Cultivating trust and collaboration not only benefits your clients but also strengthens your reputation in the industry, positioning you as a thought leader and a reliable partner in real estate transactions.

To secure the best terms for your client in a commercial real estate deal, leveraging relationships is crucial. Cultivate and maintain strong connections with key stakeholders such as brokers, property managers, and legal experts, who can offer valuable insights and access to off-market opportunities. Use these relationships to gain negotiating leverage, uncover potential issues early, and explore alternative solutions that may not be apparent in standard negotiations. Establishing trust and rapport can also facilitate more favorable terms and faster resolutions. Building and nurturing these connections enhances your ability to negotiate effectively and secure advantageous outcomes for your client.

RELATIONSHIPS IN CRE ARE WORTH AS MUCH AS THE REAL ESTATE ITSELF. Tapping into your network of brokers, property managers, and industry pros isn’t just an added bonus—it’s a game-changer. The insights and intel you can extract from these connections give your client a powerful advantage. If you’ve established a good rapport with the opposing party or their reps, don’t hesitate to leverage it. Open communication and understanding their motivations can turn the negotiation from a standoff into a collaboration, unlocking concessions that pure hardball tactics would never achieve.

Never bluff. Deception should not be an arrow in our quiver. And, as Robert Frost said, “All the fun’s in how you say a thing.”

In one of my more challenging deals, clear communication was my greatest tool. By actively listening to the landlord's concerns and openly discussing my client's needs, we found common ground where none seemed possible at first. This respectful and professional dialogue not only eased tensions but also led to a solution that satisfied both parties, demonstrating how crucial effective communication is in negotiations.

Clear communication is essential in negotiations. Begin by understanding your client's needs and presenting them in a straightforward manner. Listening carefully to the other party fosters trust and can uncover shared interests. Approach discussions with respect and professionalism, even when faced with disagreements. This attitude can turn potential conflicts into opportunities for collaboration. Aim for a constructive dialogue that seeks win-win solutions, as this not only benefits both sides but also strengthens relationships for future interactions. The way you engage can shape the negotiation's success, making it vital to maintain a positive and open-minded approach.

THE CRUCIAL LESSON IN NEGOTIATION IS MAKING IT A TWO-WAY STREET. It’s not just about pushing your client’s agenda; it’s about truly hearing and articulating what the other side is saying before you respond. This approach does more than just foster respect—it reveals the common ground and hidden opportunities that can drive the negotiation forward. When you take the time to listen first, you’re not just reacting—you’re responding with insight and strategy. That’s how you turn a conversation into a collaboration and move closer to a win-win outcome.

To secure the best terms for your client in a commercial real estate deal, focus on analyzing the details meticulously. Start by reviewing the property's financial performance, including NOI and cap rates, to benchmark against market standards. Examine the lease agreements for key clauses such as rent escalations and renewal options. Assess the property’s condition and its location within the market context, considering factors like future development plans that could impact value. Analyzing these details will help in understanding the property's true worth and leverage this insight to negotiate terms that align with your client's objectives.

Analisar contratos de alta complexidade requer conhecimento e experiência. Hoje, antes de finalizar a aquisição imobiliária, faz-se necessário observar cláusulas abusivas ou exageradas que até conflitam com o ordenamento jurídico.

Thoroughly examining every detail in commercial real estate agreements is vital for safeguarding your client's interests. Focus on key elements such as lease duration, renewal clauses, and maintenance duties. Look for potential risks that could affect your client financially or operationally. Encourage open dialogue with all parties to clarify ambiguous terms and negotiate favorable conditions. By fostering strong relationships and maintaining transparency, you can build trust and ensure that your client feels confident in their decisions. This meticulous approach not only protects their investment but also positions you as a trusted advisor in the industry.

IN COMMERCIAL REAL ESTATE, THE EASTER EGGS ARE IN THE DETAILS—AND THEY CAN EITHER KILL YOU OR SAVE YOU. Most people gloss over the fine print, missing those crucial elements that can make all the difference. But if you’re willing to dig deep, you’ll find those hidden gems—or landmines—in the lease length, renewal options, maintenance responsibilities, and termination clauses. Scrutinizing these details is how you uncover the risks that could blindside your client or spot the opportunities that others overlook. It’s this careful, thorough analysis that ensures your client is not only protected but also positioned to gain the upper hand in the deal.

If you’re not utilizing creative finance, you’re dropping the ball. There are hundreds of commercial listings on Crexi and the MLS with over 200 days on market. The higher interest rates have directly affected commercial property value…and sellers are stuck on their 2021 prices. What do you do? Terms. Will the seller carry a note on the property? Most of our deals are seller finance deals where the seller gets interest over time and the desired purchase price.

I once negotiated a deal where the rent was a sticking point. Instead of focusing solely on the rent, I proposed a larger tenant improvement allowance as a compromise. This creative approach met my client’s budget constraints while still offering them value, and it allowed us to close the deal in a way that felt like a win for both sides.

The key to a successful negotiation is knowing what satisfy's both you client and your tenant. Knowing both their goals and objectives puts you in the drivers seat.

A negotiation is hardly ever about the money. When negotiating, you want to find out what the other side values. Wether it's a fast closing, less contingencies, pay less taxes to uncle sam or even something that they have not even though about. I experienced a sale where the seller did not necessarily want to sell his property due to the high taxes that they would have to pay and he had an amazing interest rate of 3.4 percent! So instead of buying it outright, I just took over the monthly mortgage payments, deeded the property in my LLC's name and make extra payments to him with a 5% interest rate on the total that we owed him. So he essentially became the bank, and did not hat to pay any taxes to uncle sam! Now that's a win-win deal!

Não adianta pensar em negociação sem entender primeiro o que seu cliente deseja. Uma das formas mais eficazes de negociação é focar a necessidade de seu cliente. Nem sempre a necessidade dele corresponderá ao seu desejo. Desta forma, será preciso identificar e com muita cautela, esclarecer o que se formatará como melhor oportunidade para o seu cliente.