The Key Steps in Negotiating As A Billboard Landlord

Leasing a billboard is one potential area with a profitable value among property owners. Your ability to negotiate with a billboard tenant can help increase your profit potential. There are various perspectives that you need to explore in order to learn the best way of negotiating your property to billboard advertising companies.

The income prospect as a billboard landlord

Your property value increases as a billboard owner. Whether you want to use your billboard for advertising purpose to promote and market your business or you want to lease it to tenants, you can generate profit either way. Billboard owners recognize that billboard signs are marketable to advertising companies. How much you can earn from billboard leasing will depend upon various factors, including your negotiating skills. To hurdle the challenge of doing the sales talk in pursuing a billboard lease negotiation, you need how to deal with billboard companies and potential tenants in a more advantageous way.

Calculating the value of your billboard

Billboard leasing is a novelty in property dealings. Many property owners find better value for their billboards when they leverage over its strategic location. Most billboard companies use certain equation when determining how much they can reasonably pay a billboard landlord. It is often based on the potential income value that a billboard may generate in a year. On the average, a billboard generating an annual income of $24,000 will yield about a monthly rent income of $1,500 to $2000. At most, billboard landlords should understand the market value of their billboards in order to know how much rate they can reasonably demand from potential billboard tenants.

Considering the real estate inflation

The inflation in the real estate industry can also yield a more stable income profit from billboard leasing. Getting the base of the lease of the ground against the rate of the net income will provide a billboard owner substantial amount of money from the lease in a steady manner. This will help you determine the base rate when negotiating the price for your billboard.

Consider the period of the lease

The amount you earn from billboard leasing is quite flexible. You can opt for a short or long term lease agreement. Before entering into a long term lease agreement, it is essential to contemplate the possibility of a property redevelopment that can become a significant drawback of having the billboard mounted on your land property. Make sure that the possibility of having your property reconstructed that can affect the viability of keeping the billboard within the premises is slim. It will be easier to negotiate with potential billboard tenants when you can enter into more feasible agreements that will not place the other party to a disadvantaged position.

Generally, advertisers look forward to long term agreements in order to derive better returns of their investment in marketing. It is more advantageous among billboard owners to execute a long term lease agreement as it gives them a stable income flow. However, if the prospect of reconstructing or developing your land property is most likely to happen, negotiating a shorter lease contract will be more practical.