Communication and Negotiation

Question 1

How do you approach a negotiation?

Answer 1

1. Establish authority - check I have the authority to negotiate on behalf on the Client.
2. Establish objectives - analyse the problem to determine the interests of each party.
3. Ensure I fully understand my clients objectives of the negotiation.
4. Preparation - analyse the strengths and weaknesses of each parties position including my own to establish where flaws in my argument may be used against me.
   - Manage my client’s expectations, communicate with them regularly throughout and ensure I practice active listening

Question 2

What might you consider in a negotiation strategy?

Answer 2

BATNA = best alternative to a negotiated agreement.

• The most advantageous alternative course of action a party can take if the negotiations fail and an agreement cannot be reached.
• Used as point of leverage in negotiations.
• Can also be your trump card to make a deal happen.

Question 3

What is included in Heads of Terms?

Answer 3

RICS Code for Leasing Business Premises 2020

Heads of terms must include:

• The identity and extent of the premises
• Provision for the landlord to arrange the
  provision of a Land Registry-compliant plan if the lease is registerable
• Any special rights to be granted
• The length of term and whether the Landlord and Tenant Act 1954 will apply or be excluded
• Any options for renewal or break rights
• Guarantor or rent deposit details
• The amount of rent, frequency of payment and whether exclusive of business rates
• Whether the landlord intends to charge VAT on the rent
• Any rent-free period or other incentive
• Any rent reviews including frequency and basis of review
• Liability to pay service charge and/or insurance premiums
• Rights to assign, sublet, charge or share the premises
• Repairing obligations
• The initial permitted use and whether any changes of use will be allowed
• Rights to make alterations and any particular reinstatement obligations
• Any initial alterations or fit-out (if known) and
• Any conditions of the letting, such as subject to surveys, board approvals or planning permission.

Question 4

What is the difference between a rent review notice and a rent review memoranda?

Answer 4

Rent review Notice is served by one party on another recording their notice of intention to increase the rent on a withour prejudice basis. Served in accordance with the terms of the Lease.

Rent Review Memoranda formally documents the revised rent and records the new rent payable under the terms of the Lease.

Question 5

How did you negotiate an extension of time?