One of the most common questions we get, as a tenant representation broker is; Why do I need to hire
a broker on a renewal? My name is Kristi Svec Simmons. I’m a principle here, a AQUILA Commercial, and in this video, we’re gonna
talk about the three main reasons you should hire a
tenant representation broker for a renewal. (upbeat music) One reason you should hire a
tenant representative broker for your renewal, is to create leverage. Landlords notoriously think
that when a renewal is up, a tenant will stay, and
that is the one thing that we don’t want them to think. Sometimes just hiring a broker
alone helps create leverage, but we want to do more than that. On of the ways that we
create leverage is really to go through what we call
our site selection process. It’s a full process going
from understanding the tenants needs all the way until
reviewing a lease amendment. This goes for whether it’s a new lease, and more importantly, a renewal, because as I mentioned,
creating leverage in a renewal is probably one of the
most important reasons to have somebody working on your behalf. Second reason to hire a
tenant representation broker is to really understand
where the market’s been. Most of our tenants have been
in their buildings three, five, and seven years,
and a lot has changed since they originally signed their lease. Our goal is to educate them
on where the market’s heading, where are we seeing trends, is the market looking for a slow down? All these things help us put together the best economic package we think we can go back to the landlord with. In addition to looking at trends, we also look at comparables. So whether it’s comparables
in a nearby building, comparables in their current building, comparables to what their
competitors are doing, we try to get a full grasp of
where landlords are actually transacting renewals and new leases at. One of the most important reasons, in my opinion, is negotiate better terms. A renewal in a landlords eyes
is their bread and butter. It’s the one deal that they
feel is probably one of the more easier deals to transact
with their current clients. And the way we look at it
as, if you were to move, not only would the landlord have downtime, they would have to renovate the space, they may have a significant down time, there’s a lot of things at risk for them, and so what we’d like to do is calculate what those concessions are, or what those costs are to the landlord. And in our opinion, you should
get the benefit of that, because you are eliminating any and all risk to the landlord. A lot of times in renewals, finish out allowances are
smaller because again, the landlord does not
think that you need much, and in our opinion we like to look at; well, how much would they
give to a tenant that’s moving in from another building, or what are we seeing in the market for comparable finish out allowances. We want to make sure we
capture all those concessions, and that they ultimately result in favorable economics for you. A lot of clients think if
they have a renewal option in their lease, they don’t need a broker. Once again, this is where
we can come in and help you understand the market and
help understand what sort of concessions should be available. It is very, very rare
for a tenant to exercise their renewal option word for word, as it’s stated in their lease. What we typically see, is a
client starting well in advance of when their renewal option
date is in their lease, and we start well in advance
to try to get a picture of what the market is, and
hopefully transact a deal before that so you do not have
to exercise that option. As you can see, there are a
lot of good reasons why you should hire a tenant representation
broker for your renewal. For more information, please
check out the full article on our blog, and remember, nobody knows Austin better than AQUILA. – Patrick Morrison here,
from AQUILA Commercial, and we hope you enjoyed that video. Click here to subscribe, because we’re coming
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