Spring is only a few months away, which means that you may need to up your negotiation game. When tenants or residents begin to consider other options, or when new ones are moving in, you want to be able to offer them a fair deal that draws them to your property without sacrificing business success for your management company. How can you balance both in such a tricky situation?
Mastering the Art of Negotiation
“Commercial lease negotiations pose unique challenges” that may be especially difficult for newer property managers. If you don’t have a lot of experience “wheeling and dealing” with your renters, then it can only help you to do a little research and develop a strategy before jumping headfirst into the discussion. Each person should have a “customized lease,” whether you run a commercial or residential property, so you have to begin by making sure you understand what each renter is asking of you and what you can and will do for them.
Focus first on their monetary situation, whether or not they have been able to regularly pay bills or if they are more consistently late. If these are potential tenants rather than current ones, you want to even more fully examine their finances to ensure there is no bad credit in sight. “Financial standing could also influence decisions about flexible lease arrangements and delinquent fee schedules,” so there is a lot to consider and to look for when assessing these materials. Obviously, you want to have someone whose finances are secure, but this isn’t always as clear as you might want it to be.
Remember that clarity and transparency within your negotiations are crucial. If a tenant misunderstands the requirements or expectations as put forth by you, the manager, then there could be trouble down the line when this confusion comes to light. You want to clearly outline what is expected of them and what you provide (what they can expect from you) in return. If you happen to forget one of those items, don’t worry; you’re only human. You can remedy such omissions with “warranties and remedy clauses” which will protect you in case those missing pieces come to light and spell out trouble.
An important part of all of this is your ability to level with the tenant or resident, to try and understand both their needs and their point of view. Otherwise, there is more likely to be misunderstanding and conflict. To this end, it may take practice to both give them what they want while also standing your ground as a property manager. Leveling with them doesn’t meant simply giving in, but it can certainly help your ability to negotiate more professionally.
A key piece of this entire process is your ability to incorporate technology solutions into your business. Depending on the product, device, or application, you will find that everything “runs” a little more smoothly. “Using advanced tenant screening tools” can help you to find the best renters possible based on their financial situation and background. The more advanced your tools, the better you will be able to fill your property. Outside of the people, you can use technology to see what other businesses are doing, i.e. their rent rates and so on. Comparing other properties with your own can help you get a leg up on the competition to make your own property all the more appealing.
One such solution is Budgetrac’s Property Management Software, which is know throughout the industry as a powerful software tool for property managers of all types. You can increase operational efficiency with online and mobile solutions, making it easier and more accessible than ever to review whatever information you may need at the time. With this kind of technology at your fingertips, you’ll be able to get more done, whether it’s related to tenant screening and lease negotiation or not.