Money Management Tristan on 23 Jan 2009 10:25 pm
Successful Negotiation Story
This is a somewhat amusing story that I was told today by a colleague who has recently moved offices. The chap in question had gone to look at some potential new office space to let, along with a fellow director of the business.
The landlord’s representative in the matter happened to be a very young man who happened to be the landlord’s son. When the office had been shown to the prospective buyers, the rep asked them what they thought.
The prospective tennants responded in a positive manner, but happened to mention that with the credit crunch and economic downturn, it must be harder to let offices at the moment. The rep responded by agreeing with them, and then proceeded to tell them that the building was fairly empty and that they would be glad of having any new tennants at the moment.
This then led onto a discussion about the rent for the offices, which as you can probably imagine was a little one-sided, given how much information the naive rep had let on to the prospective tennants.
From what my friend tells me, the rep initially stated that the rent was £2,500 a month. One of the directors was about to jump in and accept, when the other one (the guy I spoke with) interjected and simply stated that it was a bit pricey.
The rep at this point caved in completely and immediately lowered his price to £2,000 a month. Again, one director was almost about to accept this until the other (somewhat canny) director stopped him and reiterated to the rep that it was still a lot of money, and they had seen similar offices going for less.
Eventually, after a bit more negotiation, my friend was able to get the rep to agree to let them the rooms for £1,300 a month, with free telephone line rental thrown in for free, and the rent capped at that rate for three full years.
It just goes to show how useful a bit of information is, and why you should always play your cards close to your chest.
on 26 Jan 2009 at 3:18 pm 1.Rob Lewis said …
Unless of course the naive rep was actually extremely cunning and was looking to get say £1,000 per month for the offices, but started so high to make it look like they were getting a bargain.
Unlikely I know…
on 27 Jan 2009 at 8:48 am 2.Tristan said …
Good point Rob, I saw the offices yesterday and I would have thought that the price they have paid is good value, but £2,500 for them was a bit excessive…