How many months of free rent on a 10 year lease?
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[{"id": "dkryved", "text": "As few as possible. ", "replies": [], "depth": 1}, {"id": "dks0wjw", "text": "yeah, what the other guy said, as few as possible. I'll add that you should be looking at it holistically as well. What are the rent bumps? How much TI is the tenant getting? What is the starting rent? Figure out what the tenant actually cares about in the lease terms. Do they want a lower starting rent or are they interested in a bigger TI package? And other questions like that. Basically what I'm saying is that it is all negotiable.", "replies": [{"id": "dksyec0", "text": "This is the right answer. How much are they investing in your building? How good is their credit? What's the security deposit / letter of credit? Any T.I. or base buildout? You've got to look at the lease terms as a whole v.s the market to answer this question.", "replies": [], "depth": 2}], "depth": 1}, {"id": "dks95k9", "text": "What's the market effective rent for a space like yours? If you can handle less immediate income, it would be smart to give free rent if that's what tenant wants but make up for it in higher rent or by spreading out the free rent throughout the term so there's less incentive to default immediately after all the free months, though that's less likely if they're dumping improvements into the space.\n\nBut like I said as long as you have your target capitalization and an effective rate to match that, you can play around with rent cost and free rent just like any concession. Let us know what you decide! Also, as a landlord i wonder if a higher market rate benefits you specifically. Pushing rates in your building by adding free rent can lead towards high rent later as well as tightening in those free rent months down with a peaking market. ", "replies": [], "depth": 1}, {"id": "dksx6b8", "text": "In the Northern VA/DC market we typically ask for (and usually get) 1 month free per lease year. ", "replies": [], "depth": 1}]