Guidelines for Proposing Office Rental Discounts
It can be said that the office rental market is less volatile than the real estate market, but that does not mean that office rents are always stable without fluctuations. The following is a detailed guide to requesting office rental discounts.
How do negotiate office rental discounts?
In recent years, the supply of office space for lease has met the demand for office space. Even, the market continues to receive many new office buildings. Considering the general situation, the rent is somewhat tilted in favor of tenants, but to negotiate a clear price. Moreover, from the very beginning, your business should note the following seemingly small but quite important things:
Determine the total cost of office rental
In the market, the building management often offers competitive rental rates, but that is only the unit rent/m2 of vacant office space. When deciding to rent an office, businesses usually have to pay the total cost including rental price (the initial lease by management), management service fee, electricity consumption, motorbike parking fee – car, overtime cost (if regular overtime), and VAT (usually 10%).
Consider the method of measuring the area
In today’s market, many office buildings for lease have agreed on the method of measuring customer use area, also known as clearance area. However, some office buildings still measure according to the wall center method or according to the construction area. Accordingly, the rental unit price will be slightly adjusted, for example, according to the customs clearance, the rent is $24, then the wall center method is only $22, or the construction area method is $20. Regardless of the method of measurement, your business should also calculate the cost to be reasonable and the lowest.
Besides, to choose the most optimal office space, customers should visit directly to consider avoiding dead corners ie unused areas to minimize unnecessary costs.
Exchange rate issues and market growth
Currently, even though the office is leased, all rental payments are converted into US dollars USD according to the regulations of the State Bank. On the one hand, on the building side, the exchange rate is a growth base that follows the market. But on the other hand, on the tenant side, it is necessary to clarify the exchange rate from which bank to negotiate to get the average rate. And, customers should also note that there are buildings that adjust rents and there are courts that do not when enforcing contracts.
You can find the letter of request for office rental discount here: Sample Letter of Request for Office Rental Discount
Take advantage of all the offers of the building management for office rental discounts
To attract office tenants, some management boards offer preferential policies in stages such as free 30-day rent for customers to complete the interior, and free rent for the first 3 months. …
Don’t rush to move office without negotiating a discount
Many businesses encounter cases where the quality of the office is not commensurate with the rental price. However, businesses should not rush to move offices without negotiating, consider the option of offering rent reduction to achieve the best benefits. Because after all, if moving offices, businesses also have to suffer many consequences, both it takes time to find a new office than that and costs to redo the interior “it’s both laborious, costly and time-consuming.”.
Usually, with office lease contracts signed by term, many customers are afraid and worried that the landlord will follow the contract and will never reduce the price. However, the fact is that you can completely learn about the investor, the rental area, and the general price to grasp the right time to be able to make the best proposal and negotiate the best rental price.
Experience in making proposals to reduce office rents
When proposing to reduce office rent, you should be tactful and based on the actual situation negotiate with the building owner. When proposing a discount, you should also clearly present your views for the building manager to understand. For example, difficult economic situation, comparing prices with market prices, some disadvantages arising in the working process, service quality…
Besides, your business should skillfully make future projections and negotiate. For example, if the price is more reasonable, you can extend and extend the lease or rent more space… so that the building owner can consider and consider it to achieve the best benefits for both office tenants and tenants. room and office lessor.
Negotiating to apply for a discount on office rent, if favorable, will help businesses achieve better benefits and focus on business development, without having to spend time looking for a place or time and spending money. Office setup fee from scratch.
For Foreign companies that want to start or expand businesses and look for an office in Vietnam:
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