Lease Extensions / Renewals

NEW YORK, MANHATTAN — Tenants should be aware that the landlord is under no obligation to renew your lease unless it is specifically stipulated in your lease agreement. Often, landlords ask existing tenants to pay a rent that is above market value. Businesses are often more than willing to resign a lease so that they can avoid the hassles of moving. Landlords are often willing to renew a lease early so that they know they have a guaranteed tenant when the lease expires. Tenant behavior, including such factors such as payment history and neighbor complaints, will often factor into a landlord’s decision to renew a lease. When renewing a lease key provisions include: newly negotiated market rent, expiration date of the new lease term, new base years on tax and operating expenses, expansion options and changes in Loss Factor calculations.

It is important to negotiate a current base year when renewing a lease or landlords will have the right to upcharge the tenant based on prior tax increases from the original base year. Keep in mind that terms and provisions of the original lease remain in full force and effect unless otherwise specified. When negotiating a lease extension or renewal, tenants must keep in mind the market value and weigh the cost of the space against costs of moving the business to a new location. There is often room to negotiate on prices if the tenant has an on time payment history and has a good relationship with the landlord. Always shoot to sign a longer lease to lock in a lower rent. When signing a new lease consider the other vacancies in the neighborhood; use supply and demand to your advantage.

Before renewing, consider company growth and planned future hiring over the next lease term. Request allowance for cosmetic upgrades such as paint and carpeting to keep your office environment fresh. Negotiate for a below market rate; by renewing, you are saving your landlord from any vacancy time and sparing him construction costs.

If/when your lease is about to expire – you can count on the brokers at NewYorkOfficeSpace.com to ensure that your lease extension is executed by a broker who can leverage benefits from the landlord/owner based on an industry related working relationship and prior direct experience with all the movers and shakers who have a hand in shaping the Manhattan skyline!