The most important element in keeping lease costs down? Efficient office layout.

Typically, 75% - 80% of a landlord's rental rate is made up of sunken costs that are evaluated on a cost per square foot basis (taxes, operating expenses, debt service, etc.). The remaining 20% - 25% (the "negotiable portion") of the rental rate is limited to the landlord's ROI.

By reducing space through more efficient design, we reduce sunken costs (taxes, operating expenses, debt service, etc) that were previously "nonnegotiable" not just the 20% - 25% most tenant rep firms concentrate on. That's why our patent pending software returns results 4-5 times more effective than conventional "landlord negotiations."

Most important, these savings are generated IN ADDITION TO RENTAL RATE NEGOTIATIONS, not instead of them.

COMPONENTS OF TYPICAL $25 RENTAL RATE:
Rental Rate Components	Cost Per Square Foot Per Year	Affected by Conventional Negotiations?	Affected by Space Efficiency?
Landlord ROI (Return on Investment)	$5.00	YES	YES
Debt Service	$2.75	NO	YES
Tenant Construction	$4.00	NO	YES
Building Taxes	$5.50	NO	YES
Building Operating	$7.75	NO	YES
TOTAL	$25.00	$5.00	$25.00

In the above example, the landlord's ROI is the only negotiable part of the rental rate. In a strong market, he might be able to sign tenants at his quoted rental rate. In softer markets, he'd probably have to cut the rate by $2-$3.00 per foot, which would also reduce the ROI.

When landlords analyze the economics of potential lease transactions, the range of rental rates/concessions they might consider may be as narrow as $1.00 per square foot. But regardless of market conditions, there's always a bottom line they simply won't cross.

Reducing the square footage through efficient space design doesn't affect this dynamic. Because landlord's costs are always calculated on a per-square-foot basis, cutting the size of your office space never affects how he analyzes the economics of potential transactions.

Simply put, finding a way reduce the amount of space you lease by 10% has the same impact as the landlord reducing the rental rate from $25.00 to $22.50, without cutting into the ROI.