To keep negotiations going, just keep talking

Real Estate By Chris Stephens

What should you do when commercial real estate negotiations become cantankerous? Negotiations may go bad for any number of reasons. One side may have done something that really upset the other side. Maybe you are dealing with people who push too hard for what they want. Or you feel disrespected. Or you think the other side is not being honest.

If negotiations have upset you, take a step back. Think about what you want to achieve. I have seen people become so upset that they lose sight of the main goal, which is to reach an agreement. Instead, they just want to show up the other side. That attitude is a good way to kill the deal. Who said commercial real estate was not emotional?

Stooping to the other side's level might feel good but it's not an effective way to do business. If you want the deal, you have to find a way to negotiate in spite of the other side's behavior.

Start by looking at your own thinking and assumptions. Maybe at least part of the problem is on your side, not theirs. Are they really doing all the bad things you think or might you be misunderstanding them? Perhaps you are too sensitive, taking the negotiations personally. Maybe you are offended by the other side pushing too hard for what they want. You may need to remind yourself that negotiating sometimes involves real friction.

Try to understand what they are doing that is so upsetting to you. Lay out your concerns to the other side and ask them to explain their thinking.

If the other side is a large organization, the person you are negotiating with may be under a lot of pressure to get the "best deal possible." That person may be "papering" the file with unreasonable demands, to show how hard he or she tried.

Give the other side the benefit of the doubt. For example, if the negotiator is slow to respond and offers the excuse of being distracted by other demands, that may well be true.

Perhaps the other side is not that competent and doesn't communicate clearly. For example, terms that are already agreed upon get brought up again and again. If that happens, be firm. Continue saying what you will do and ask the other side to stop revisiting items that are already settled.

Most important, keep talking. As long as you're talking, the deal is alive and you may be able to reach agreement. Stay focused on the end result you want: a successful transaction. Force yourself to ignore bad behavior and keep working for solutions.

Chris Stephens, CCIM, is a local associate broker specializing in commercial and investment real estate. His column appears every month in the Daily News.