SAN JOSE, CA-As office rents in the Bay Area and Silicon Valleyincrease, cost-conscious tenants are looking for other ways to savemoney. And in viewing their total occupancy costs, more CEOs, CFOs,and real estate executives are starting to question their approachand scrutinize all negotiable lease terms in an effort to add valueto the bottom line. So says Robin Weckesser, amanaging principal at Cresa in San Jose, who is incharge of heading up the Bay Area Project Management group.Weckesser recently chatted with GlobeSt.com on the subject.

According to Weckesser, many tenants are avoiding extra costs byconsulting a project management early on in the game, to evenassist in site section. “With declining vacancy in all markets ofthe Bay Area and the need to update second-generation buildings,this need is even more critical,” Weckesser says.

He gives an example where a tenant signs what appears to be a“perfect”45,000-square-foot lease in a location with workforcerecruitment, high visibility etc., and the transaction includes acompetitive rental rate or $5 per square foot annually belowcurrent market rates over a seven-year term plus three months offree rent. At first glance, he says, it seems good. But whatabout not meeting the scheduled occupancy date due to unanticipateddelays with permitting and furniture; a delay of three monthsresults in loss of the negotiated free rent and a costly holdoverpenalty on the current lease?, he says. Or what is the tenant laterrealizes they need 5,000 less square feet or “if you engaged anarchitect who, after completing a code analysis, tells you thatbecause of new occupancy requirements, you can’t accommodate asmany employees as you thought, and you now need additionalspace?”