As a tenant representative firm Lpc Cresa is committed to helping clients optimise their premises needs through the ups and the downs. The coronavirus impacts on commercial tenants are unique, as they are unrelated to the property and business cycles and are characterised by many unknowns and risks. Whilst the retail sector is the first to have been hit, many office and industrial tenants are facing unprecedented challenges.
This is a time that calls for extraordinary collaboration between tenants and landlords in pursuit of commercial and retail leasing arrangements that will enable tenants and landlords to get through covid-19, while getting ready for post covid-19.
Lpc Cresa advisors have been working with many of our clients to reduce occupancy costs in order to better align expenditure with decreased revenue and reduced utilisation of leased premises. Whilst retail has been hardest hit so far, no sector has escaped the impacts as commercial and industrial tenants grapple for solutions along with many not for profit operators and government agencies. We are leveraging the experiences of Cresa colleagues across the globe to ensure our advice and services reflect the aggregate innovation of this diverse group of tenant advocates.
In practical terms. we are working with clients to meet the current risks through a range of interventions that include collaboration with landlords for interim assistance via rental reduction and related measures, looking to lease provisions for relief where applicable, sub-leasing, deferral of leasing commitments, utilising flexible accommodation alternatives, and identifying opportunities for reduction in occupancy costs unrelated to the lease.
Whilst focusing on the immediate challenges, we are simultaneously preparing for a post covid-19 era. Our project services team and our tenant advisory team are thinking through the implications of covid-19 staffing numbers and work practices, as they work with occupiers to ensure premises and leases are suited to a post covid-19 era. Works that are difficult and costly to implement when premises are fully utilised are being undertaken at this time, including preparing for disposal of excess space. Our tenant advisors are working hand in hand with the project services team to help align leasing and related accommodation arrangements for life after covid-19.
In the retail sector, our advisors are working with retail clients to achieve rental concessions, defer new store openings and implement other immediate occupancy cost savings whilst we have already commenced work preparing clients for the post covid-19 era by ‘right sizing’ portfolios, implementing changes to store formats and negotiating leasing arrangements that better protect the retailer.
Plato once said that "necessity is the mother of invention", The coronavirus has certainly provided the necessity for invention when it comes to accommodation arrangements both during and post covid-19.