The Advantages of Free Rent
October 28, 2019
Most tenants understand the impact of office rent on their bottom line and try to reduce it, often by negotiation. However, they frequently overlook free rent, a common concession in the current real estate market.When averaged over the full term of the lease, free rent decreases the total rental expense more than one might expect. As an example, let’s say you are leasing 10,000 square feet for five years at $30 per square foot. Negotiating four months of free rent lowers the annual average almost $2.00 per square foot, a cash flow savings of almost $100,000, often within the first lease year.
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