The Asking Price is Not Always the Market Price

In this current market, there is a wide range of pricing on commercial property for sale or lease.

Last week I had two separate conversations with a Landlord and Agent, who both had space for lease that was offered at prices well above (one was 100% higher!) fair market rent. We made offers based on market data to see if we could put a deal together but there wasn’t any interest. They both wanted a number that was unreasonably high.

Rather than go back and forth, I thanked them for their time and moved on. We were so far apart and there wasn’t any flexibility, so I couldn’t see a scenario where we could put a deal together.

In these types of scenarios there are a couple of ways this could play out. The Landlord finds someone to pay their asking rent. The Landlord comes down in price and puts a deal together. The space remains vacant.

If you’re a Tenant or a Buyer, be careful or you could get taken advantage of and be the person that overpays. If you’re a Landlord, make sure your property is priced right or be prepared to have it sit empty while you try and find someone to pay an asking rent that’s above market.