Approximately two million commercial lease renewal transactions take place every year in North America. Whether a restaurateur is leasing commercial space in a strip mall, shopping mall, or in a stand-alone building for a restaurant business, he/she eventually will have to face a lease renewal negotiation with a landlord. Starting with the end goal in mind and planning far enough in advance will make this process much easier.
Most landlords push for a rent increase on a tenant's lease renewal. This is normal and something you should anticipate. Much can transpire in a 5- or 10-year lease term between when you moved in and when you need to negotiate a lease renewal. Negotiating a lease renewal is not an overnight process … this can take some time and involves a number of steps (as found in our book, Negotiating Commercial Leases & Renewals FOR DUMMIES, and as summarized below):
Do create competition for your tenancy.
Restaurant tenants should negotiate on multiple locations simultaneously - especially with lease renewals, even if they don't want to move. Create options and play one landlord against another. Share with each landlord that you are receiving other proposals.
Do start the planning and site selection process well in-advance.