Commercial property rental can be a sound and lucrative financial investment, but it all depends on having good tenants in the building. As an estate agent you can become invaluable if you’re able to help a landlord secure reliable commercial rental tenants each time their property becomes vacant. Keeping a building full and profitable is certainly a skill. A good commercial letting agent will:
Who's the best fitting tenant for your commercial building?
Have potential tenants on tap
Once you have your head in the commercial property rental game, it’s worth making yourself known to plenty of local businesses, and keeping an eye on whose contracts are due for renewal. It’s a handy asset to have a portfolio of potential tenants. You can dip into this to find a great fit for the landlord’s building, and it will only speed up the re-letting process.
Identify potential tenants
A good potential commercial rental tenants are new start-up businesses and those moving to town. A tenant who is already in business and is looking to expand, relocate or renovate is also a strong candidate. If your building can offer them a larger, more modern solution or a space with a higher footfall, they’re likely to be interested. Tenants whose existing lease is coming up for renewal are also worth keeping in your line of sight, as they’ll be shopping for better contracts and your property could be just what they’re looking for. It’s worth being friendly and contacting these people early, as your efficiency will likely be rewarded by a good reputation. Tenants who are new to the market, or simply don’t know what the local commercial property rental rates are, will also appreciate your guidance.
Recognise a good fit for the property
To narrow down a list of potential tenants you’ll need to make sure the businesses are looking sustainable and successful, although you’ll develop an eye for a business that’s expanding so rapidly it could outgrow your property quickly. You also want a good business profile that fits the building and the area too. It’s important you have a sense of which businesses are successful in the surrounding neighbourhood. If the building you’re filling has more than one tenant inside, these businesses and people need to integrate reasonably well with each other for a thriving building that retains tenants.
Think about the long-term gain
Tenants will also need to have a proven, reliable rental history and good references. If they’ve moved their business often in the last few years, it’s worth checking up with all the landlords, not just a few, to determine why they moved so often. Of course, you’ll need to ensure the intended use for the building is in line with the allowable uses based on the regulations. If the tenant’s use is allowed but they’ll want to make changes to the space, such as updating the flooring or changing the layout by adding walls, you’ll also need to check this with the landlord. If it isn’t desirable for the landlord to change the building structure, then this isn’t the tenant for them. You’ll also want a lease which complements the landlord’s plans for the building and, ideally, improves the rental return in the future; you’ll want a lease that’s not too long and not too short, but just substantial.
As an estate agent, having a good grasp of commercial property rental, and understanding the local field inside out, can make you a great asset to a landlord. Head to the commercial property page for more insider tips and insight-based blogs.