You might have a quality commercial structure with everything business owners could want and need, but that doesn’t mean they’ll be your tenant long-term. The conditions you impose, the relationships you maintain, and your willingness to look after your tenant can all negatively or positively impact your retention rates. If tenant retention is a continuous problem, it’s time to take action. You might be able to solve this problem by taking the steps below.
Make Necessary Upgrades
If you’ve only just started thinking about advertising commercial real estate for lease, ensure all necessary upgrades are completed to bring it up to a rental standard. By doing so before new tenants move in, you might reduce the risk of your tenants facing frustrating problems that impact their ability to do business.
You might look at sub-metering utilities so tenants only have to pay for the portion of the building utilities they use. Some building owners also hire electricians and plumbers to inspect these building fundamentals. You can then be informed about their condition and the potential for further repairs or upgrades in the future.
Hire a Property Manager
Commercial building owners don’t always have time to take care of their tenants. They also don’t always want to be fielding calls at all times of the day and night regarding issues they’ll need to remedy. If you prefer to be a ‘silent’ property owner, hire a property manager. They can look after your property on your behalf and ensure your tenants are well looked after.
However, performing basic research before choosing a property manager is essential. Read reviews and ask for recommendations. Customer service needs to be one of their priorities to potentially improve your tenant retention rate.
Mantain Your Property
Alongside ensuring all necessary upgrades are completed before your new tenants move in, ongoing maintenance is equally important. The goal of all maintenance tasks should be to preserve a property’s integrity, safety, and cleanliness.
While some tasks fall on the shoulders of your tenants, you’re still responsible for most functions that maintain the building’s appearance and functionality. Keep on top of maintenance, and you might enjoy long-term, happy tenants.
Go Above and Beyond
Your commercial building is an investment, but it’s important not to see your tenants as profit. They are real people trying to make a living like you are. Go above and beyond, and you might see loyalty in return.
Something as simple as a Christmas gift might make your tenants feel valued. Otherwise, you might try to foster an excellent working relationship with them by inviting them to networking opportunities. Getting to know your tenants when you deal with them directly might prove more helpful than you think for tenant retention.
However, you might also look at financial ways to retain your tenants. It’s not uncommon for commercial property owners to enjoy long-term tenants by offering incentives and discounts when they refer other tenants to them, pay their rent early, or renew their lease.
Provide Competitive Rental Rates
Businesses are paying an average of $22.95 per square foot of space, with prices on a sharp upward trajectory since 2019. As a result, business owners are shopping around to find the best deal on the most suitable commercial premises they can find.
If your prices aren’t competitive compared to other similar commercial buildings in your area, you might not retain long-term tenants. Instead, tenants might be tempted to shop around once their lease period ends. Get into the habit of comparing your property to others as the commercial building market changes. You can then make adjustments as you see fit.
Retaining tenants doesn’t have to be as challenging as some commercial building owners find it to be. Take these actions above, and you might enjoy long-term, loyal tenants who value you and your building.