5 Reasons it is important to tour (Even if you plan on renewing your lease)
In the Houston market, statistically over 75% of tenants that I run into renew at their current location. Insurance agents are some of the most loyal tenants that I know, once they settle in and get Allstate, Farmers, or State Farm to pony up cash for that monument sign they are there to stay. They always say that the Landlord is giving them a good deal even though they don’t know or care to know the market rates. In their mind the deal is acceptable, so if there is money on the table so be it. Those signs can run about 20k a pice so they are really strong factors in why some tenants stay in their space.
Reason #1: New Construction
Houston has more new construction going on now than in the last decade. From the Woodlands to the Energy Corridor, there are plenty of new architectural wonders adding to the Houston landscape offering new views, new designs, and new opportunities to be closer to home, your client base, or employee base. When company’s move into new construction, your clients and competitors will take notice. They may have been eyeballing the address themselves.
Reason #2: Building Renovation
New construction doesn’t have all the fun. Even older Class A, B, and C product are frequently renovated when a building is sold to a new owner. A solid renovation may turn a building a building with character into a “must have” for your next lease. While most renovations are aesthetically pleasing, many buildings may just update the AC or elevator systems making everyone’s stay more reliable and enjoyable.
Reason #3: Compare Value
There is something about experiencing a building that provides a context to rental rates. Recently, we represented a law firm in the Galleria that insisted on Class A space for a relocation. They refused to look at Class C properties because logic suggests that a building with half the rental cost must provide half the look and feel of a Class A space. In this case, the property was a newly renovated Class C property which offered the same amenities, and a superior curb appeal with the new improvements. Not every experience is like this, but you never know unless you get out there!
Reason #4: Different Floorplans
There are a nearly infinite number of floorplans configurations out there. Want to know how your competitors are utilizing their space? A tour is a great way to take a look at how different companies your same SF utilize space. Many times, my clients are inspired by floor plans from a tour and make adaptations.
Reason #5: Backup
Stuff happens. What happens if you get a letter from the government announcing they are expanding the road in front of your building? (Happens all the time) How about the when the Landlord you love sells the property to another owner who immediately moves to renew at very aggressive rates? Or how about unexpected business growth or retraction? Having options means that you can sleep at night knowing that you have done your due diligence and are ready to take advantage of the best opportunity.
James Robertson, Jr., Managing Broker
Robertson has listed over 3 million SF and has represented a diverse cross-section of entities as tenant rep broker–from Fortune 500 companies to municipalities and start-ups. (more about James)
Recent posts from James