Some of the preparatory steps a lessee should consider before renewing a lease:-
1. Establish a property strategy with a reasonable time to implement it. Do not wait until the last 3 or 4 months before the lease expires to consider the affects of your strategy.
2. Assess the impending tangible and intangible costs to relocate. Tangible costs would include making good current premises, office fit-out, IT structuring, staff dislocation plus a myriad of other costs. Intangible cost in the main would be the impact on customers.
3. Ask yourself some hard questions including:
- Do I need the space I am currently leasing?
- Should it be more?
- Can it be less?
- Can I reduce space used to store documents by outsourcing to an off-site document storage facility?
4. Re-consider the terms and conditions of your lease option (if you still have one).
5. Establish a fair market rental for your premises. Research, research and research the market’s factors:
- The Dollars per square meter.
- The type of outgoings (statutory and operating) and their cost per square meter.
- Total size of the premises.
- Productivity per square meter.
- Use of premises.
Now you are in a position to renegotiate your lease knowing with confidence what your options are.