I'm a landlord with a prospective tenant who's asking for many considerations - what's fair?

I inherited a small commercial building and need to rent out the space immediately. A prospective tenant who wants a 3 or 5 year lease with options to extend also wants a few other things like:

1) Two months free rent to start
2) no lease increases at all for the length of the initial lease
3) an out clause for early lease cancellation
4) a shower installed without permits since they have to pay for the improvement.
5) tranferability to a new tenant if they are forced to shut down before the lease expires.

I'm willing to negotiate and compromise, but what's fair these days in the land of commercial leasing?

being in the property management and construction field- I would compromise to #1...two months free rent...but with this restriction---the two months free rent are at the end of the lease with a 90 day notice to vacate from either party.

#2 - lease is to be 3 years with an increase of 9.5% per year.

#3 - NO OUT CLAUSE for the Leasee

#4 - DO NOT install or allow any TI (tenant improvements) without permits....you will be held liable by the local building authorities....and if this tenant gets upset with you-he may report you....don't do it.....any TIs (tenant improvements) are at the approval of the owner and at the tenant's expense 100%.

#5 - No transferability.....they are responsible for the 3 year lease. If they do not think they are viable...then do a year to year lease...with a 15% increase annually.

good luck - hope this assists you....

you own it, you say whats fair. that 2 months free thing, are you kidding me? let them know your not comcast running a special. you let them know what you're wanting and if they cant give that to you then move forward.

I think the two months free rent are fair. The rest is just chisling you. A lease is for a certain period of time. What's the use of a lease if he can jump out of it at will? He's a cheap bastard. Find someone else.

in the world of being a landlord, you should call the shots. They are asking WAY to much of you. Not many places offer 2 months free rent, and I've never heard of anyplace offering to install anything without a permit (hello illegal!!!!!!!!!!), or transferability. You deserve the ability to raise the rent every year, as long as its resonable- maybe you should negotiate that rent will go up with the cost of living (look up inflation rate), no more, no less. I say keep looking for somebody to rent that place to, even if you have to cut the rent a few bucks, don't sign yourself into that kind of hell the possible tenant is trying to get you to.

Commercial property negotiations are different but this guy is trying to railroad you. If you give them an out clause or transferability in the lease the lease serves no purpose! A shower installed without permits? Are they going to pay the fines against you too? Free rent is a common negotiation issue which is a way of lowering the square foot price and might be a valid consideration depending upon the space and the market where the property is located. Also the request for no rent increase during the term of the lease is a maybe because usually attached to the consumer price index for the sake of inflation.

The bottom line is that everything has to do with you market, but I suggest you say NO to #3, #4 and #5 without question. Just make sure you get the tenant to personally guarantee the lease!

I know nothing about commercial rentals but have been a Landlord for 26 years. Fair? Substitute the word equitable. All 5 of the items on your list are solely to the interest of the perspective tenant, and they sound VERY shaky, not to mention a pain in the butt, before they are even in there. If a prospective tenant asked me for those terms, I would refuse. Advertise your space, get creative in who you are willing to rent to. Hasty decisions make for leisurely regret. Good luck.

Find a different tenant. With the demands this one is laying on you, you may as well rent month to month without a lease. On top of that, they are asking you to allow illegal plumbing in your building, for which YOU will be responsible after they leave.

You have the wrong prospective tenant ,
you are the landlord and you set the rules and he follow ,
Be patient you will find some one who is not headache
Because this future tenant seem like is trouble ..
I hope I could help ...