RENT ABATEMENT: The period of months where you the tenant do not pay base rent (expenses are still accrued) as a concession to signing a multi-year lease. This usually gets capped out at a maximum of one month of abatement per year of term.
But what if you could convince a landlord to give you additional rent abatement in the form of a rent credit?
If you negotiate a robust Tenant Improvement allowance that covers your construction bids, but then value engineer the cost of that construction to be less than the estimate you based your TI allowance off of; shouldn’t you get to use the money saved? The answer is YES but you have to negotiate that language into your lease. This helps offset your initial rent obligation, or can even be applied to buying new furniture or fixturized equipment. You just have to know what to ask for.
If you’ve got questions about leasing or purchasing commercial real estate, we’ve got answers.
Jamal Brown is the CEO of The Ocean Company, an exclusive tenant representation firm with offices in San Diego, Orange County and Los Angeles focusing on the leasing and acquisition of commercial real estate.
Main: 858.356.2990 | E-mail: jbrown@theoceanco.com | social: @theoceancompany