How to Successfully Negotiate a Department Store Lease

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Leases for a department store can be rather pricy. After all, you will often need a considerable amount of space to display all of your wares. While most commercial landlords may not have that much scope to negotiate on the base rent, there may be other ways that you can attempt to save money when obtaining that lease. These tips should help.

Work with a Real Estate Attorney

If you are looking to obtain a department store lease, you must work with an attorney. The attorney will have a couple of jobs.

The first is to ensure that you are not tied into an unfair contract. The second purpose is to help you with the negotiation process. An expert will be able to identify negotiation points where you may be able to save a small amount of cash.

Negotiate a Fixturization Period

Some landlords will spruce up the building for you to make it ready for residency for your business. If this happens, then you will need to spend money on renting the property.

If you are converting the property yourself, then you may be able to negotiate a fixturization period. This is where you are given the ability to set up the inside of the building ready for your business. This will either be at a discounted rate or completely free if a lot of work needs to be carried out.

Free Rent Period

In some cases, a landlord may be able to give you a discounted month here and there. For example, we have seen some landlords that may provide a month’s free rent for every year that the tenant is in place. This can add up to a significant amount of savings.

Longer Rent Period for Lower Base Rent

If you know that your business will be successful, you may want to tie yourself into a more extended contract for lower base rent. Although, this is something that we suggest that your real estate lawyer negotiates for you. This way, you can be sure that everything will be done correctly, and you are not greeted with massive fines for breaching a lease, etc.

Counter Offer

It is fair to say that most landlords won’t have that much of an ability to negotiate the base rent on the property, there will always be a small amount of leeway built into the price. Quite often, you will be able to secure yourself a discount of 10-15% on the base rent for the property. All you need to do is ask. You may have an easier time negotiating a price if the store has been empty for a while.

Of course, this is just scratching the surface of ways to save money on that lease for your department store. A good attorney will be able to help you even more. Make sure that you talk to them before agreeing on a lease.


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