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The Lean Rent Playbook: How to Avoid Hidden Occupancy Costs
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3. Missed lease renewals
Estimated cost: $100,000+ in increased rent costs or if
missed renewal result in eviction, $1,000,000+ in lost
revenue for retailers, and $100,000+ in relocation expenses
for office occupants
Lease renewal dates can occur on any day of the year. When
you have thousands of leases, like some retailers, with
renewal windows popping up every five to ten years, it's easy
for one to slip through the cracks.
A commercial eviction removes 100 percent of your store's
annual revenue and forces office occupiers to find a new
space to relocate their workers. While it might seem like
a far-fetched scenario, it's a serious concern with any size
portfolio. Each lease has its own renewal clause, and if you
intend to continue leasing a location, you need to monitor
the key dates and steps you need to take within the renewal
window.
