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How to re-negotiate your office lease

Written by Amanda Hamilton on Tuesday, 11 May 2021. Posted in Commercial law, Legal

With many businesses looking to downsize their office or change the type of office space they have it may be necessary to renegotiate the existing lease.

How to re-negotiate your office lease

With many businesses looking to downsize their office or change the type of office space they have it may be necessary to renegotiate the existing lease.

Is it possible and, if so, how do you approach it?

Start by checking your lease to see if there is any adverse clause in there that may prevent you negotiating. For example, a clause stating that ‘there shall be no rent negotiation after one year’ or ‘negotiation on rent will only be acceptable after three years occupation…’ etc. 

Also check what notice periods there are, especially important if your negotiation is unsuccessful and you want to move elsewhere. 

Having read through the lease and hopefully finding there is no untoward clause preventing you, it’s time to start your negotiation with your landlord. Knowing the content of your lease in advance will stand you in good stead in reaching a mutually beneficial arrangement, and may avoid any potentially embarrassing situations.

If your landlord is approachable and amenable then try to build a rapport. The first rule of negotiation is to gain an understanding of who you are dealing with, and to appreciate the other party’s viewpoint. So, saying something along the lines of: ‘this has been a difficult year for us as I am sure it has been for you too..’ puts the landlord at ease and on the same playing field as you. 

Think in positive terms of what you want to achieve, rather than what you don’t want. This will help put you in the right frame of mind. Coming on too strong or too aggressive could have an adverse effect on your intended outcome. Honesty and integrity are two vitally important traits to have in any negotiation.

These tips may help you achieve your win-win goal:

  1. Understand who you’re dealing with and take time to think about things from their point of view. This will make it easier to pitch what you want
  2. Know in advance what you want to achieve
  3. Don’t come on too strong or too sugary sweet. Strike a professional balance
  4. Keep listening 

Once you have reached your goal, ask a professional paralegal to assist you in drafting an agreement to reflect the negotiation you have reached. Paralegals charge a lot less than solicitors and can many of the same tasks, including drafting agreements or changes to your lease.

If negotiations fail or things turn unpleasant, a paralegal may be able to help here too. Sometimes taking the emotion out of the negotiation and letting independent third parties continue the talks, can help bring things back to the real issue of the lease negotiation. 

If negotiations fail and your landlord will not budge, then legally there is likely to be little you can do. If there is a fixed rental period, you could try again when this ends or, if the lease allows, you can give the required notice and look to relocate to premises with a lease that better suits you. 

About the Author

Amanda Hamilton

Amanda Hamilton

Amanda Hamilton is Chief Executive of the National Association of Licensed Paralegals (NALP), a non-profit Membership Body and the only Paralegal body that is recognised as an awarding organisation by Ofqual (the regulator of qualifications in England). Through its Centres, accredited recognised professional paralegal qualifications are offered for a career as a paralegal professional. 

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