There are several types of commercial leases and terms, but a common thread among them is that the devil is in the details. Commercial real estate lease contracts are notoriously tricky documents, and a good or bad lease can mean manageable versus inflated real estate costs or even the difference between success or failure for businesses. With so much riding on a single document, it’s wise to consult a professional commercial real estate broker. Many Tenants don’t realize that a commercial real estate broker can also be retained for lease renewals. Tenant representation during lease renewal negotiations helps ensure that the terms are in line with the market and often leads to competitive concessions being received on lease rates and premises improvements. When the economy is soft, Landlords with near term rollover are further motivated to lock-in Tenants rather than risk losing them. This is a critical opportunity to not only renew the lease, but improve the lease.
The Preston Center Sub-Market has seen a 13.5% increase in the Class A vacancy from 7.4% at the end of second quarter 2015 to 8.4% at the end of the second quarter 2016. Average full-service rental rates of Class A space increased per square foot, from $35.75 to $37.30 during the same timeframe. Class A direct net absorption was a negative 22,979 square feet for the second quarter of 2016.
The Lower Tollway Sub-Market is defined by the geographic boundaries of Alpha Road on the south, President George Bush Turnpike on the north, Preston Road on the east, and Midway Road on the west. Rental rates for Class A properties have climbed a staggering 8% over the past year, and 15% over the last two years, to$29.57 full service.
At the end of the second quarter of 2016, the flex market averaged a $8.84 psf triple-net rental rate, which is a significant increase from the second quarter average rental rate in 2015 of $8.16 psf triple-net. The vacancy rate for the second quarter of 2016 sits at 7.1%.
The Richardson/Plano Sub-Market has shown an increase in the direct Class A vacancy from 5.9% in the second quarter of 2016 to 21.3% at the beginning of the second quarter of 2016. Meanwhile, direct weighted average full-service rents increased per square foot from $23.20 to $25.96 per square foot during the same time.