5 Ways to Use Lease Comps to Strengthen Renewal Negotiations

SKIP AHEAD TO

• Understand Market Trends and Benchmarks
• Tailor Negotiation Strategies to Specific Tenants
• Justify Proposed Terms with Credible Data
• Assess Competitive Positioning
• Evaluate Past Negotiation Outcomes
• Why Choose CompStak for Reliable Lease Comps?
• Final Thoughts

Renewal negotiations are a critical component of asset management. For asset managers working with mid-size to large firms, securing favorable terms during lease renewals directly impacts tenant retention, operating income, and the overall value of retail spaces. Yet, achieving successful outcomes often requires a comprehensive understanding of the commercial real estate market, tenant behavior, and competitive positioning. Enter lease comps: a powerful tool for accessing market data, comparing lease terms, and negotiating with confidence.

Lease comps, or lease comparables, are detailed records of lease agreements for commercial properties. By leveraging lease comps, asset managers can derive actionable insights, streamline negotiations, and secure advantageous renewal terms. This blog outlines five practical ways to use lease comps to strengthen your lease renewal strategy while showcasing how CompStak’s cutting-edge platform supports data-driven decision-making.

1. Understand Market Trends and Benchmarks

Lease comps provide a window into prevailing rental rates, concessions, and lease structures across similar commercial properties. For example, you can use CompStak to identify the average asking rent for retail spaces in a target submarket or benchmark tenant improvement allowances granted in recent renewals. Reviewing CompStak’s data on metrics such as free rent, median lease term, and typical escalation rates empowers asset managers to evaluate their own rents relative to market standards, ensuring neither overpricing nor undervaluing lease agreements.

For instance, if CompStak data shows that properties in your area increased tenant improvement (TI) allowances by an average of $5 per square foot year-over-year during renewals, you can adjust your negotiation strategies accordingly. With CompStak’s comprehensive database of verified lease and sale comps, asset managers can easily identify and track these trends.

2. Tailor Negotiation Strategies to Specific Tenants

Tenant retention is not one-size-fits-all. Each tenant has unique priorities, challenges, and financial considerations. Lease comps empower you to develop customized strategies by analyzing deals that align with a tenant’s profile.

For instance, CompStak data can reveal that a national apparel retailer accepts a standard 3% annual rent escalation for renewals in urban locations, while preferring flat escalations in suburban properties.

Leveraging these tenant-specific patterns, from break options to renewal incentives, enables you to approach negotiations with a clear picture of what similar tenants have accepted in other markets. CompStak simplifies this process by providing access to detailed lease terms by tenant type, market, and transaction date, giving retail asset managers valuable, targeted insights into tenant behaviors and preferences.

3. Justify Proposed Terms with Credible Data

When asking tenants to agree to rental increases or reduced concessions during a renewal, it is essential to back up your proposal with precise data. Lease comps offer that proof by documenting what other tenants have agreed to under similar circumstances, providing transparency and credibility in negotiations.

For example, if your property offers competitive amenities and visibility, you can use CompStak data to demonstrate why higher rents are justified. Present average base rent per square foot for comparable assets within the past 12 months, or highlight the average annual rent escalation percentages reported for properties of similar class in your local market. Additionally, referencing data on average tenant improvement allowances and typical rent-free periods—sourced directly from recent CompStak comps—enables you to show exactly where your terms align or exceed market standards.

CompStak’s platform equips you with these verified data points, allowing you to present objective evidence during discussions and increase the likelihood of achieving mutually beneficial agreements.

4. Assess Competitive Positioning

Understanding where you stand compared to competitors is vital for renewal negotiations. Lease comps allow you to identify opportunities to differentiate your property and address potential tenant concerns proactively.

For example, with CompStak’s platform, you can compare your property’s average base rent to similar assets within the same retail corridor or submarket. You can leverage CompStak insights on average tenant improvement allowances, lease term lengths, and escalations in the area to benchmark your offerings in precise terms. With CompStak’s analytics tools, asset managers can pinpoint these key differentiators and leverage them to create compelling cases for renewal.

5. Evaluate Past Negotiation Outcomes

Lease comps aren’t just a tool for understanding the market—they’re integral for evaluating your own performance. By leveraging CompStak’s historical lease data, you can identify trends in average rent increases, typical concession values, and lease term adjustments across previous renewals and new leases. Analyzing these specific data points helps reveal what negotiation approaches have delivered the best results.

This retrospective, data-driven analysis allows you to refine renewal strategies over time, enhancing outcomes and tenant satisfaction rates. For example, reviewing CompStak data on prior concessions or escalation percentages can show whether your terms have remained competitive or exceeded market norms. CompStak provides a centralized view of your transactional data alongside broader market trends, offering a holistic view of how to enhance future negotiations.

Why Choose CompStak for Reliable Lease Comps?

CompStak stands out as a leading provider of commercial real estate data, trusted by retail asset managers nationwide. Here’s how the platform empowers teams to make informed, strategic decisions in lease renewal negotiations:

• Comprehensive Coverage: Gain access to millions of verified lease comps across the United States, with data points covering rent, term length, concessions, and more.
• Unmatched Accuracy: Every lease comp undergoes a rigorous data verification process, ensuring reliability and precision.
• User-Friendly Interface: Search, filter, and analyze lease comps with ease using CompStak’s intuitive platform.
• Actionable Insights: Go beyond raw data with analytics features that help identify trends, benchmark rents, and evaluate negotiation outcomes.

Final Thoughts

Lease renewals are a pivotal opportunity to retain tenants and optimize revenue. By leveraging lease comps, asset managers can approach negotiations with confidence, armed with data that ensures fair and competitive terms. CompStak’s platform seamlessly integrates with this process, offering unparalleled access to verified data and actionable insights.

From understanding market benchmarks to justifying your proposals and assessing performance, lease comps are an invaluable resource for asset managers.

Ready to elevate your lease renewal negotiations? Explore the power of CompStak today and redefine what’s possible with data-driven decision-making.