I once heard a New Zealand export manufacturer talking positively about this country’s competitive advantage against some of the really big players in the world such as China and the U.S.

He said our advantage was our ability to be light on our feet and to adapt quickly to changing markets, rather than the exercise of turning the Titanic that might be required of some of the huge operators internationally.

It is this sort of thinking that is needed in today’s commercial property lease markets.

I’ve talked in recent years about how creative thinking will land the best deals for tenant and landlord alike.

And in the tumultuous market of the past year, I’ve started to see more and more businesses think this way.

Commercial tenants are increasingly starting to take the initiative and look at making their leases smarter and work better for them. More and more are starting to seek flexibility, and this ranges from terms & conditions to thinking sustainably.

In terms of sustainability, proximity to public transport is commonly being rated as highly as the number of car parking spaces being offered.

It is important for tenants to realise that with the current high vacancy levels, they are in a position to dictate terms.

However, it is important to realise that a broad brush approach to seeking variations is not always going to cut it.

For instance, vacancy levels and the reasoning behind them differ greatly in the three main centres of Auckland, Wellington and Christchurch. The dynamics of Auckland has vacancy levels at the highest in the country at around 15 percent.

In Wellington, off the back of government investment in buildings, vacancies have been climbing more slowly to around 3 percent.

Meanwhile, in Christchurch vacancy levels have risen to around 6 percent as the export led economy of the Canterbury region has slowed.

An intimate knowledge of the markets is becoming increasingly important as the dynamics shift in many directions, and tailor-made solutions are the key. As I have often said before, I urge those with commercial leases to seek expert advice. A DIY approach is increasingly risky as trends shape-shift in many directions.

With more than 20 years experience in property markets under my belt, I have never known a more unpredictable time. It takes a steady ear to the ground and careful reading of trends and signs just to keep on top.

I recommend a “light on your feet” approach with expert coaching from the sidelines!

Tags: commercial property leasing, recession property strategies

This entry was posted on Tuesday 28th July 2009 and is filed under Recession Strategies. Both comments and pings are currently closed.