June 8, 2016
Most people in Atlanta have seen the new concession stands pricing for the new Atlanta Falcons stadium, Mercedes-Benz Stadium. If you are like me, you love the new prices! So what does that have to do with commercial real estate?
The new stadium has caused Falcons season ticket prices to go up, along with the length in which ownership wants a customer to hold their season tickets. Sounds a little like the current commercial real estate climate. Rental rates are going up, along with the term in which owners ask you to sign a lease. What I like about the way the Falcons are doing things is at least they are giving more value in other areas with the increased ticket prices. Sure, you may be paying more for the tickets, but you are getting a better fan experience in the stadium. That is something that I can get behind.
Rental rates are going up, along with the term in which owners ask you to sign a lease.
That brings me back to commercial real estate owners. Rental rates are going up, but are they providing more value in other areas within the building? Or is it the same experience for a higher price? I know that Piedmont Center North, where Transcend is located, has added some great outdoor amenities along with a tenant lounge. Overlook III has added a great tenant lounge and a new gym for their clients. What about other owners?
Are you providing your clients more value?
If you are going to charge more rent because the market is getting tighter, that is your call. I get supply and demand. However, don’t allow your clients to feel like you are taking advantage of the market by not providing a better customer experience with a higher rental rate.