Start Renewal Negotiations Earlier Than Expected
If you’ve been successful in your current space, you may feel that you should lock it down for another term as soon as possible if you have a renewal option and you’re nearing the end of your original lease term. But if you start the renewal process very early—say, six to 12 months before the lease ends—the owner might tell you it’s too early. That’s because it may be holding out to see whether fair market values will bump up a lot so that it can, in turn, substantially raise your renewal rent.
You can avoid falling into a renewal rent increase trap, however. In that case, tell the owner you’ll look for space elsewhere because a big rent increase may make the space no longer desirable, which might jolt the owner into starting renewal negotiations when you want to—on the early side—and giving up on a potential big rent increase.