Navigating the End of Your Commercial Lease



For business owners, the prospect of an expiring commercial lease can be a double-edged sword. On one hand, it marks the end of a chapter and the potential for new opportunities. On the other, it raises crucial questions: Should you renew, renegotiate, relocate, or even consider buying a building? Let's review. 


Option 1: Renewing Your Lease


Renewing your lease is a straightforward choice, and in many cases, it's the most practical. If your current space suits your needs, has a favorable location, and has served your business well, renewal can be a convenient option. It offers stability, continuity, and, often, a chance to secure a reasonable rental rate. However, it's crucial to assess whether the renewal terms align with your future needs and budget.

Key questions to ask:

1. Does the space still meet your business requirements?

2. Is the rental rate competitive?

3. Are there any clauses or terms that need adjustment or negotiation?


Option 2: Renegotiating the Lease

If you're mostly satisfied with your current space but think there's room for improvement, renegotiating the lease might be the best approach. This option can allow you to address concerns such as rent increases, lease terms, or other conditions that might not suit your evolving business needs.

Key steps in the renegotiation process:

1. Identify areas for improvement in your existing lease.

2. Consider your bargaining power and prepare your arguments.

3. Open a dialogue with your landlord or property management to negotiate better terms.


Option 3: Relocating to a New Space

Relocating your business to a new space is a significant decision. It might be the right choice if your current location no longer meets your needs or if you've outgrown your space. When considering relocation, it's essential to conduct thorough research on potential properties, assess the impact on your customer base, and weigh the moving costs.

Questions to consider:

1. Is a new location strategically better for your business?

2. What are the costs and logistics associated with the move?

3. Will you have to alter your branding or marketing strategy with a new location?


Option 4: Buying a Building

For some businesses, buying a building can be a wise investment. Instead of paying rent to a landlord, you invest in an asset that can appreciate over time. This option is more feasible for businesses with long-term stability and financial resources, but it offers long-term control and potential for significant savings.

Key considerations for buying a building:

1. Can your business afford the purchase and the associated costs?

2. Is the location ideal for your business's long-term plans?

3. Are you prepared for the responsibilities of property ownership, including maintenance and property management?


The end of a commercial lease is a pivotal moment for any business. Your decision on whether to renew, renegotiate, relocate, or buy a building depends on various factors. Consider your business's current and future needs, financial situation, and long-term goals carefully. If your commercial lease is coming to a close and you are unsure what your next steps are, don't hesitate to call me at 765-427-5052 or email bneihouser@shook.com for a guaranteed response.

Cut Through The Noise. Get Straightforward Advice. 


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