1.
Tips for More-Effective
Commercial Real Estate
Negotiations

2.
By using NUMERAL, a mnemonic
How do you uncover
information in the
negotiation process?

3.
We often assume…
“They will never pay that much.”
“We've got to have it done in 60 days.”
“There is a lot of competition.”
“They would never be interested in this option.”
“They don’t have enough money.”
“I’m sure we’re not the top bidder.”

4.
Don’t trust your assumptions.

5.
Used to:
• Develop open-ended questions
• Create a process for successful negotiations
• Uncover needs and wants
• Test your assumptions
NUMERAL

6.
Needs
Urgency
Motivation
Expectations
Resources
Authority
Loyalty
NUMERAL

7.
Needs
NUMERAL
Determine the nature of the needs and wants. Is it:
• More space?
• A new workplace solution?
• A green and natural buffer from retail/commercial uses?
• The satisfaction of having city recognize community needs?
• To clean up an eyesore?
What's the most important need?

8.
Urgency
What are the timing issues, if any, and what is driving the urgency
of the negotiations?
• Allot time to prepare.
• Identify the pressures.
• Time is money so use it.
• Beware of the quick deal.
• Uncover the deadlines, real or imposed.
• Ask questions to determine if parties have any time issues.
NUMERAL

9.
Motivation
This answers all of the “why” questions.
• Why do you have the needs you have?
• Why is time so important?
• Why negotiate this deal?
Uncover the true interest of everyone involved.
NUMERAL

10.
Expectations
Discover what all parties expect to obtain.
• What is your aspiration level? Those who expect more get
more.
• Aim high, but weigh the risks. Always justify and determine your
holdout time.
• Always be able to justify your offer.
• Establish realistic expectations in the negotiations process.
NUMERAL

11.
Resources
What resources do you have in the negotiation process?
• Information is power.
• What are the tangibles and intangibles?
• Can they apply political pressure?
• Is litigation one of the tools they possess?
• What can they bring to the table?
• How do you increase the size of the pie and claim/share that
value?
• Evaluate your BATNA (best alternative to a negotiated
agreement) throughout the process.
NUMERAL

12.
Authority
What is the process of getting this transaction approved?
• Does it require a higher authority?
• Who are the invisible players?
• Understand the sources of power.
• What type of authority are you negotiating with? Could an
outside force affect the deal later on?
NUMERAL

13.
Loyalty
Is everyone committed to the negotiation process?
• Find out if everyone is committed to working together fairly.
• Agree to disagree.
• Act in a professional manner.
• Demonstrate your commitment to the process.
NUMERAL

14.
NUMERAL
Why use it?
Because information gathering is an essential step in
finding a better deal for both parties.

15.
For more negotiations tips, check out the article “Negotiating
Difficult Deals” from Commercial Investment Real Estate magazine.
CONTINUE READING

16.
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