All Forum Posts by: Victor Barcik

If the lease does not have a renewal option the commercial tenant becomes a month to month tenant at lease maturity. They have the right to leave or you have the right to ask them to leave. You have to negotiate new lease terms at that point. May as well use your form of lease. 

Thanks Jon 

That's a pretty high tenant concentration with 5 tenants occupying approx. 82% of the space. Carefully examine your rollover risk and the following: 

- tenant quality. Publicly traded? If not, see if there are tenant financials for the larger tenants. 

-Find out how long the tenants have been at the property. If a tenant has had significant growth in business there is a possibility they are outgrowing their space and may need to move near lease maturity. 

- carefully examine the lease expense structure. Many office leases have base stop expenses that reset at renewal, therefore the reimbursements will be a lot less. 

- I hope you backed out a decent vacancy factor as well as capital reserves from your noi, which an appraiser would do. An office building at 100% occupancy is very rare. There is a possibility that rents might be below market, which if future upside for you. 

Good luck.