Commercial rent increases

[Tom D]

You can do a small anual percentage with an inflation adjustment above/below a certain %. So you're asking us to help you be more, or less, greedy to maximize your profit or minimize loss?

And he needs our help, he's a residential appraiser who like to own commercial.

 

[Fernando]

You can do a small anual percentage with an inflation adjustment above/below a certain %. So you're asking us to help you be more, or less, greedy to maximize your profit or minimize loss?

And he needs our help, he's a residential appraiser who like to own commercial.

With my commercial rents, I'm seeing most of the rents have been same since Covid. Hard to increase on current commercial tenants.
But best time to negotiate is starting new lease...."to be greedy to maximize" profit.

I know the tricks. Some give 6 months free rent then have higher market rent later based on cap rate to get higher sales price. Can't fool me.

 

[Tom D]

Me thinks your only concern is to be the highest poster each month, not the highest rent you can get, of which you already know the answer.

 

[Fernando]

Me thinks your only concern is to be the highest poster each month, not the highest rent you can get, of which you already know the answer.

Now you know why he's called King Appraiser.

 

[Fernando]

Glad I have this thread.
Can't believe I'm still negotiating with this tenant.
Yesterday, he said I offered him 3% yearly increase over 10 years. I don't remember and I said I'll check my notes.
Yep, this thread indicated I wanted 4%.
I'm having doubts with this disingenuous character.

 

[Terrel L. Shields]

If he would stay 10 years I'd be happy to not inflate the rents at all for 10 years. Getting a steady stream of income beats hit and miss and have zero income for months. You have dallied with this for 2 plus months now. You are cutting 16.67% off your rental income for 2025 already.

 

[Mark K]

Typical in this area would be 5 yr. lease, fixed rent with tenant having 2-3 five-year options and rent to increase 10-15% every 5 years.

Be glad you have a tenant.

Remember the stock market adage..."Bulls make money, bears make money, hogs get slaughtered." Don't be a hog.

 

[Fernando]

Typical in this area would be 5 yr. lease, fixed rent with tenant having 2-3 five-year options and rent to increase 10-15% every 5 years.

Be glad you have a tenant.

Remember the stock market adage..."Bulls make money, bears make money, hogs get slaughtered." Don't be a hog.

I was able to get 4% from prior new tenant last year in same building. Something about this new tenant I don't feel right since he's been dragging this negotiation for so long.

 

[Terrel L. Shields]

was able to get 4% from prior new tenant last year in same building.

So? Did they stay? Is the economy better today than this time last year?

 

[Fernando]

So? Did they stay? Is the economy better today than this time last year?

With Trump in office, outlook for economy doesn't look good.
One of my tenant told me last week that he is going to sell his business. He paid rent on time last year but since December been struggling and late.
I stopped going to my tenant's restaurant because portion got smaller and not as tasty as before (also when I heard about the rodent issue).

Just came back from dinner tonight. I go out at least 2X a week and the restaurants I go to appear to have lots of people especially during a weekday.
People still going out to eat or at least the restaurants with good value for the food.