Any commercial brokers on here?

[Rain Man]

Quick question if you don't mind.

My company has office space in downtown Denver, and we’ve been working a deal with our current landlord to move to a different space in the building. We agreed on a rate and they put the lease together. This landlord offers good pricing, but they’re very hard to deal with and we don’t find them very trustworthy.

Anyway, they sent over the lease, and it contains an expense stop for 2012 (when we first moved into the building). We expected the expense stop to be for 2016 since that’s when our new lease starts. Is it standard to keep the expense stop at the initial lease setting when a tenant is renewing? Or does it usually get updated to a date related to the new lease? How much of a battling point is this? And does it make a difference that we’re moving to a different space in the building?

Any advice would be appreciated. Good advice will be rewarded with a picture of an adorable kitten.

[Chiefshrink]

Everything is negotiable regardless. I would think especially here in Denver where the cost of living is astronomically high and real estate is back on the rise (key here)]that the expense stop would have a higher number to your point for 2016. Not a lower number from 2012. Maybe it's an oversight but then again to your point maybe it has something to do with your new digs according to their calculations. Larger digs or smaller digs?

Everything is negotiable is the field you play on and don't take no if you feel it is really unfair especially if you check around first with your other tenants if they will talk to you about their contracts which is what I would do if I were you prior to talking with them so that your negotiating position is well armed. However, they may feel they dont have to play ball(renegotiate) and are willing to lose your business knowing they can fill your space immediately because of demand and you really have no leverage at all. It's the cost of doing business aspect so I would think that number should be higher.

Kinda of like the salary cap in the NFL. It only goes higher as time goes on.

[Dave Lane]

Originally Posted by Rain Man

Quick question if you don't mind.

My company has office space in downtown Denver, and we’ve been working a deal with our current landlord to move to a different space in the building. We agreed on a rate and they put the lease together. This landlord offers good pricing, but they’re very hard to deal with and we don’t find them very trustworthy.

Anyway, they sent over the lease, and it contains an expense stop for 2012 (when we first moved into the building). We expected the expense stop to be for 2016 since that’s when our new lease starts. Is it standard to keep the expense stop at the initial lease setting when a tenant is renewing? Or does it usually get updated to a date related to the new lease? How much of a battling point is this? And does it make a difference that we’re moving to a different space in the building?

Any advice would be appreciated. Good advice will be rewarded with a picture of an adorable kitten.

If you are leasing a new space the stop should be based on 2016. Or at least 2015 since 2016 technically is unknown at this point. It maybe they just left the date in from the previous lease. Request they update the lease to read 2016 and failing that demand it be 2015. Have they hit you for stop payments before at your current space?

[Rain Man]

Originally Posted by Chiefshrink

Everything is negotiable regardless. I would think especially here in Denver where the cost of living is astronomically high and real estate is back on the rise (key here)]that the expense stop would have a higher number to your point for 2016. Not a lower number from 2012. Maybe it's an oversight but then again to your point maybe it has something to do with your new digs according to their calculations. Larger digs or smaller digs?

Everything is negotiable is the field you play on and don't take no if you feel it is really unfair especially if you check around first with your other tenants if they will talk to you about their contracts which is what I would do if I were you prior to talking with them so that your negotiating position is well armed. However, they may feel they dont have to play ball(renegotiate) and are willing to lose your business knowing they can fill your space immediately because of demand and you really have no leverage at all. It's the cost of doing business aspect so I would think that number should be higher.

Kinda of like the salary cap in the NFL. It only goes higher as time goes on.

Yeah, the thing is that a 2012 expense stop means that we're covering four years of inflation right from the start. Essentially, it means that the landlord is paying utilities, cleaning, taxes, etc. at 2012 levels and we're responsible for the difference. That seems like a really bad deal on our part and doesn't seem like it's standard practice.

I love the building, but I can't stand the landlord. They're sneaky and petty and try to nickel and dime us, but they're also apparently not bright enough to do research since their base rates are under the market considerably. So they keep ripping us off, but even so it's still a good deal. I don't even know how to react to that. Do I fight the corruption or do I let them win and think they're taking advantage of me when I'm really the one winning? It's a bizarre situation.

Oh, and here's a kitten for you.

[Rain Man]

Originally Posted by Dave Lane

If you are leasing a new space the stop should be based on 2016. Or at least 2015 since 2016 technically is unknown at this point. It maybe they just left the date in from the previous lease. Request they update the lease to read 2016 and failing that demand it be 2015. Have they hit you for stop payments before at your current space?

Yeah, we have a payment every year, but it's been small. It was only a few hundred dollars last year. In our previous building, it ended up being several thousand in our last year of the lease, so I'm really sensitive about it.

It seems to me that it should be 2016 base year, but a commercial broker friend of mine just wrote back and said, "Yeah, not surprising that they do that, and probably not worth battling over."

I'm completely confused now. It just seems wrong, but I don't want to fight over it if it's not going to be a big deal.

Here's your kitten:

[Hog's Gone Fishin]

Originally Posted by Rain Man

Yeah, the thing is that a 2012 expense stop means that we're covering four years of inflation right from the start. Essentially, it means that the landlord is paying utilities, cleaning, taxes, etc. at 2012 levels and we're responsible for the difference. That seems like a really bad deal on our part and doesn't seem like it's standard practice.

I love the building, but I can't stand the landlord. They're sneaky and petty and try to nickel and dime us, but they're also apparently not bright enough to do research since their base rates are under the market considerably. So they keep ripping us off, but even so it's still a good deal. I don't even know how to react to that. Do I fight the corruption or do I let them win and think they're taking advantage of me when I'm really the one winning? It's a bizarre situation.

Oh, and here's a kitten for you.

If you feel like you are winning in the overall picture. Let it go. Get a good nights sleep.

[Dave Lane]

Originally Posted by Rain Man

Yeah, we have a payment every year, but it's been small. It was only a few hundred dollars last year. In our previous building, it ended up being several thousand in our last year of the lease, so I'm really sensitive about it.

It seems to me that it should be 2016 base year, but a commercial broker friend of mine just wrote back and said, "Yeah, not surprising that they do that, and probably not worth battling over."

I'm completely confused now. It just seems wrong, but I don't want to fight over it if it's not going to be a big deal.

Here's your kitten:

I've found it never hurts to ask. Worse case they refuse to update the date. If they are worried it may screw up they deal I'm pretty confident they will back down. I do all the time. If no one asks then they don't get an update.

[Rain Man]

Originally Posted by Hog Farmer

If you feel like you are winning in the overall picture. Let it go. Get a good nights sleep.

Yeah, that's kind of where I'm reluctantly landing. I've been in the building for four years and like it, and the price is good. It just annoys the heck out of me that they keep lying to me, and seem to think that they're pulling the wool over my eyes. I have no idea how they don't understand market rates, but commercial brokers tend to boycott them because they're so hard to deal with, so maybe they don't get data.

Here's a kitten for you:

[Rain Man]

Originally Posted by Dave Lane

I've found it never hurts to ask. Worse case they refuse to update the date. If they are worried it may screw up they deal I'm pretty confident they will back down. I do all the time. If no one asks then they don't get an update.

Yeah, we went back to them about it, and they said they'd just recalculate to a higher rate. They also sprung on us that they're going to "continue to hold" our deposit when the new space should have a lower deposit. The deposit thing isn't a huge deal financially, but it was a knife planted square in my back after some other negotiations.

The situation is alien to how we negotiate with our vendors and customers. We have a "look out for me and I'll look out for you" relationship with our key people where we all do what's fair while still making a profit. It's really nice and we all tend to trust each other. These guys are exactly the opposite, and it sure damages the relationship.

I figure I'll sign the lease and over the next five years I'll get asked about the building by at least one potential tenant, and I won't pull any punches. They'll make a couple of thousand dollars off of me and never know that it cost them much more than that.

[JoeyChuckles]

I'm here for the kittens.

[Rain Man]

Originally Posted by JoeyChuckles

I'm here for the kittens.

You have to earn the kitten. But I can give you an adorable manta ray for your effort.

[Chiefshrink]

Originally Posted by Rain Man

Yeah, the thing is that a 2012 expense stop means that we're covering four years of inflation right from the start. Essentially, it means that the landlord is paying utilities, cleaning, taxes, etc. at 2012 levels and we're responsible for the difference. That seems like a really bad deal on our part and doesn't seem like it's standard practice.

I love the building, but I can't stand the landlord. They're sneaky and petty and try to nickel and dime us, but they're also apparently not bright enough to do research since their base rates are under the market considerably. So they keep ripping us off, but even so it's still a good deal. I don't even know how to react to that. Do I fight the corruption or do I let them win and think they're taking advantage of me when I'm really the one winning? It's a bizarre situation.

Oh, and here's a kitten for you.

Well then you have answered your own question then in my eyes. If you feel you are getting a good deal but feel nickel and dimed to death then you have to crunch the numbers on the nickel and dime stuff and is it worth it still. They may realize they gave you too good of a deal back then because the market wasn't that hot so maybe they are trying to make it up somewhat by being petty and sneaky with the nickel and diming. Combine that with your nuances about $$ in general and dealing with people and then you will have your final answer. I really don't think this is about $$ at all with you specifically. With you this is about fairness and what is right and more importantly who you are giving your $$ to and the lack of professionalism dealing with seedy greedy nickel and dimers that drives you up the wall.

Often times you pay some kind of price for a good deal. Are you still willing to pay the price that often does not involve $$ is the question for you in my mind.

[Rain Man]

Originally Posted by Chiefshrink

Well then you have answered your own question then in my eyes. If you feel you are getting a good deal but feel nickel and dimed to death then you have to crunch the numbers on the nickel and dime stuff and is it worth it still. They may realize they gave you too good of a deal back then because the market wasn't that hot so maybe they are trying to make it up somewhat by being petty and sneaky with the nickel and diming. Combine that with your nuances about $$ in general and dealing with people and then you will have your final answer. I really don't think this is about $$ at all with you specifically. With you this is about fairness and what is right and more importantly who you are giving your $$ to and the lack of professionalism dealing with seedy greedy nickel and dimers that drive you up the wall.

Often times you pay some kind of price for a good deal. Are you still willing to pay the price that often does not involve $$ is the question for you in my mind.

You are exactly right on the bold part. I can crunch the numbers and sign the deal, but I really bristle at not being treated honestly. And from a pride standpoint, I want to tell them that they're not really fooling me or trapping me into a deal, but if I do, I'll end up paying a higher rent in another building.

Here's a therapy kitten for your service:

[Chiefshrink]

Originally Posted by Rain Man

You are exactly right on the bold part. I can crunch the numbers and sign the deal, but I really bristle at not being treated honestly. And from a pride standpoint, I want to tell them that they're not really fooling me or trapping me into a deal, but if I do, I'll end up paying a higher rent in another building.

Here's a therapy kitten for your service:

Have you given them any indication that you do not like them in general ? I guess what I am asking is do they know already you are pissed ?

[Rain Man]

Originally Posted by Chiefshrink

Have you given them any indication that you do not like them in general ? I guess what I am asking is do they know already you are pissed ?

I don't think they do. I try to remain diplomatic. But when the guy told me on Friday that "they had decided to hold my deposit", I suspect that he could tell by my glower and flared nostrils that I was not happy. I don't know if openly being mad is a good strategy with these people or not. Most times, it's not, but they're not the normal people that I deal with.