Question for everyone out there in commercial real estate. My father owns a automotive repair facility in CT and wants to rent out his upstairs to a renter he already has in the back of his building. The renter is currently paying 2200 for 6500 square feet. The upstairs is an additional 14,000 square feet.
Question 1. He was told by his accountant 2nd floor space is cheaper then first floor space so the 4 and change he gets downstairs he would not be able to get. He seem to think he will only get 2.50 square foot.
Question 2. Space is space. If the man wants to utilize over 20000 square feet per space shouldnt he be charged for that space at the current rate.
Question 3. This space has not been utilized in 15 years. Are we stuck behind the 8 ball because there has been no income for the space for such a long time.
This is very late but your accountant is normally correct. Most often, second floor space is less expensive simply because it is less convenient. The fact that you haven't leased it in 15 years on matters if it has been neglected, or if you allow that to effect your negotiations. Good luck renting it.
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