Most tenants wait too long to decide. We break down the real cost of both paths — and show you how to negotiate either one.
The right choice comes down to four factors: how well your space fits your team today and in three years, whether market rents have moved in your favor, your landlord relationship and current lease terms, and how much runway you have before expiration. Most tenants should start this analysis 12–18 months before their lease expires — waiting until six months out hands your landlord most of the leverage.
In This Guide
Most tenants think about lease renewals too late. They wait until they feel pressure — a landlord inquiry, a CFO reminder — and by that point, the window to negotiate from strength has often already closed.
The right starting point is 12–18 months before your lease expires. 4 That horizon gives you enough time to run a real market survey, complete a competitive tour process, negotiate meaningfully, and finish any build-out before your current lease expires. Starting earlier gives you even more leverage. Starting later costs you options.
If your lease expires without a signed renewal, most commercial leases automatically convert to holdover status — typically at 125–150% of your current rent, month-to-month, with no security. 3 Some leases also give landlords the right to terminate on 30 days' notice. This is one of the most expensive and avoidable situations in commercial leasing.
Look for your "renewal option" clause. It will specify a notice window — typically "no later than 9 months" or "no later than 6 months" before expiration. Missing that window can contractually void your renewal rights, forcing you to negotiate from scratch with no guaranteed option to stay.
Answer the questions below based on your current situation. The tool scores your answers across four dimensions — space fit, cost, lease terms, and operations — and gives you a directional recommendation with reasoning. No login required.
Renewal makes the most sense when most of the following are true for your situation:
| Factor | Favors renewal when... |
|---|---|
| Space fit | Current space fits headcount within 10–20% of ideal |
| Build-out investment | Significant custom work that would cost $100K+ to replicate |
| Rent vs. market | Current rent is at or below comparable market listings |
| Landlord relationship | Responsive maintenance, open to negotiation, flexible on requests |
| Location | Address is material to brand, recruiting, or client access |
| Timing | Less than 9 months until expiration — relocation timeline is risky |
| Market conditions | Vacancy is low — fewer alternatives, higher move-in competition |
| Operational stability | You're in a fundraising sprint, hiring freeze, or high-growth phase |
Even if you decide to renew, negotiate. At renewal you can push for reduced base rent, a free rent period, a refreshed TI allowance for suite improvements, a CAM cap (typically 5% annually), and elimination of unfavorable clauses. The landlord's cost to replace you — new commissions, months of vacancy, full TI for a new tenant — is often far higher than the concessions you're asking for.
| Factor | Favors relocation when... |
|---|---|
| Space fit | You're 30%+ over or under your ideal square footage |
| Headcount trajectory | Significant growth or downsizing projected within the lease term |
| Rent vs. market | Comps show you're paying 15–25%+ above comparable options |
| Lease terms | Personal guarantee, no CAM cap, or demolition clause you need to shed |
| Landlord relationship | Persistent maintenance failures or unresponsive property management |
| TI opportunity | Build-out is dated — office TI typically ranges $30–$70/SF in 2026 2 |
| Market conditions | High vacancy — landlords competing with significant concessions |
| Timing | 12+ months out — enough runway to tour, negotiate, and build out |
TI allowances reset when you sign a new lease. Office TI allowances in 2026 typically range from $30–$70 per square foot, with higher amounts in competitive high-vacancy markets. 2 For a 5,000 SF space, even a mid-range $50/SF allowance means $250,000 in build-out dollars that relocation puts back on the table. Run that number against your moving cost estimate before assuming renewal is the cheaper path.
Not sure what comparable space costs in your market? A TenantBase broker pulls current comps at no cost.
Get free market comps →The most common mistake tenants make is comparing their current base rent to the headline rate on a new space, then assuming renewal is cheaper. That's a comparison of two numbers that both leave out most of the real cost.
When you net out TI allowances and free rent against moving and transition costs, relocation is often cheaper over the full lease term than it appears at the headline rent level — especially in soft markets. A tenant rep broker can model both scenarios side by side in 48 hours.
The single most powerful thing you can do in either a renewal or relocation negotiation is make your landlord believe — credibly — that you are genuinely evaluating both options. Landlords who think you'll definitely renew have little incentive to move on rent, TI, or lease structure.
Tenant rep brokers are compensated by the landlord — whether you renew or relocate — so there is no direct cost to you. 6 Their value in a renewal is often underestimated: they know what landlords in your submarket are conceding to comparable tenants right now, they can run a competitive process without you lifting a finger, and they know exactly how hard to push before a landlord walks away. TenantBase matches you with a vetted local broker in your market.
Find the notice deadline and calendar it. Also check holdover terms, personal guarantee scope, and any demolition or redevelopment clauses you'll want to address.
A tenant rep pulls comparable active listings and recent transactions in your submarket within 48 hours. This sets your negotiating baseline and tells you whether the market has moved in your favor.
Even if you're leaning toward renewal, touring builds credibility and identifies your best real alternative — the anchor for every negotiation that follows.
Your broker opens the conversation — ideally with a renewal proposal reflecting current market rates, not the landlord's anticipated ask. Anchoring the negotiation early matters.
If your landlord isn't moving, request an LOI from the best alternative. This is the moment most landlords recalibrate — losing a tenant is expensive, and most will negotiate harder when faced with a real alternative.
Be under LOI with either your current landlord or a new one. If relocating, lease execution and build-out needs to begin now to close before your current lease expires.
Your signed lease executes before your expiration date. Communicate your decision to your current landlord in writing at least 90 days before expiration regardless of which path you take.
TenantBase connects you with a local tenant rep broker who can run your market comparison, tour alternatives, and negotiate either path — at no cost to you.
Disclaimer: This post is for informational purposes only and does not constitute legal, financial, or real estate advice. Commercial lease transactions are complex and vary by market and circumstance. Consult a licensed commercial real estate professional and qualified attorney before executing any lease agreement. Commission structures vary by market; tenants should verify local customs with their advisor and legal counsel.