Commercial Real Estate Dictionary

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Concession

Definitions of Concession
  • A concession is an incentive or discount given to a tenant by a landlord to make a lease more enticing.
    Due to the difficult economy and competition among landlords, we had to give concessions such as one month free rent to retain our tenants.


What Is A Lease Concession?

Lease concessions are discounts, incentives, or benefits conceded by a landlord to a tenant to conclude a commercial lease transaction.

Lease concessions may consist of free rent, tenant improvement allowances, deferred or reduced lease escalations, signage, or parking. Any benefit a landlord can offer a tenant to discount or defer rent, or accommodate the tenant is a lease concession.

Lease concessions are generally negotiated between the tenant and landlord, however some lease concessions are offered by landlords looking to entice tenants during difficult markets. As this implies, market conditions impact the ability of tenants to benefit from lease concessions.

As market experts, brokerage professionals can advise and negotiate lease concessions on behalf of the tenants they represent.


        

Real Estate Terms

1. How much cash will be required to make your mortgage payments? Debt Service >>


2. Who can you go to to finance your construction or development project? Construction Lender >>


3. What professional can assist you in maximizing the value of your investment property? Asset Manager >>


4. How can we assess future commitment to infrastructure to support our communities and future development? Capital Improvements Projects >>


5. What measurement indicates if a property's financial performance can cover its debt? DSCR >>


6. What part of a city is the center of urban economic development? CBD >>


7. What allows property owners and professionals to estimate the market value of a commercial property? Comparable Property >>


8. What can landords do to entice prospective tenants? Concession >>


9. What critical factor do stores depend on to drive traffic? Anchor Tenant >>


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