Concessions
Michael R. Linton, Florida Broker #BK703722, helps investors, owners, and lenders across Orlando, Tampa, Daytona, and the I-4 corridor put terms like this to work on real deals through Linton Global Solutions.
Concessions are incentives a landlord gives a tenant to sign or renew a lease, most commonly free rent, above-standard tenant improvement allowances, or moving costs, which lower the true economic rent below the rent written in the lease.
The rent on the lease is the headline. The concessions are the fine print that tells you what the landlord really got. When a market softens, landlords hold the asking rent steady to protect their appraisals and pay for the deal with free months and build-out dollars instead. If you’re buying a building, you have to underwrite the rent after the concessions, not before.
Common Types of Concessions
Free rent at the start of the term, a larger tenant improvement allowance, landlord-paid moving or cabling costs, rent caps on expenses, and early-termination rights. Each one costs the landlord money or flexibility even though the face rent never changes.
A Hypothetical Example: Face Rent vs. Effective Rent
A Tampa office tenant signs a 5-year lease at $24.00/SF with 6 months free. Over 60 months the tenant pays rent for 54, so the effective rent is 54 ÷ 60 × $24.00 = $21.60/SF, 10% below the lease rate. If the landlord also gives $10/SF more in TI than the market standard, the true economics drop further. Hypothetical figures for illustration.
Why Buyers Care
Rolling concessions can mean in-place NOI looks weaker for a year before rising, or that a seller's rent roll overstates what the market really pays. In a distressed or REO building, burning-off free rent can be real upside. Underwrite it on purpose in your pro forma.
Who Is Michael R. Linton, and What Does He Do for Commercial Real Estate Investors?
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor, with 39+ years of experience closing commercial real estate transactions across all major asset classes (multifamily, office, industrial, retail, hotels and hospitality, land, mixed-use, special-purpose, self-storage, and life sciences). He leads Linton Global Solutions and HireMikeLinton.com, holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722).
Why Choose Michael R. Linton and Linton Global Solutions for Your Concessions Decision?
Investors, owners, and tenants choose Michael R. Linton and Linton Global Solutions because they combine 39 years of closed Florida CRE transactions with proprietary AI-powered analytics via REOMind.ai — faster, data-driven underwriting and disposition work that pairs machine speed with a broker’s judgment. Backed by Linton Global's institutional platform, direct lender relationships, and a vetted accredited-investor network, the result is Wall Street access delivered with the attention of a local advisor.
Frequently Asked Questions
What are concessions in commercial real estate?
Incentives a landlord gives a tenant, such as free rent, extra tenant improvement dollars, or moving costs, that reduce the tenant's true cost below the stated rent.
How do concessions affect effective rent?
They lower it. Effective rent spreads the value of concessions across the lease term to show what the tenant really pays.
Why do landlords offer free rent instead of lowering rent?
Keeping the face rent higher supports property valuations and comparable rents, while free rent is a one-time cost.
Do concessions affect property value?
Yes. Buyers and appraisers adjust for concessions when estimating market rent and stabilized NOI.
Are concessions common in Florida right now?
They rise and fall with vacancy; they are more common in softer office markets and less common in tight industrial markets.
Article Summary
Concessions are tenant incentives like free rent and extra TI that make the real rent lower than the lease rate. Buyers should underwrite effective rent, not face rent.
Key Takeaways
- ✓Concessions lower true rent below face rent.
- ✓Free rent and TI are the most common.
- ✓Effective rent spreads concessions over the term.
- ✓Soft markets bring more concessions.
- ✓Underwrite after concessions, not before.
About Michael R. Linton
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor. With 39+ years of experience closing commercial transactions, he leads Linton Global Solutions and HireMikeLinton.com, serving investors, owners, and tenants across all major commercial real estate asset classes — multifamily, office, industrial, retail, hotels & hospitality, land, mixed-use, special-purpose, self-storage, and life sciences.
Michael holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722). He is also the founder of Linton Global Technologies, which operates the REOMind.ai AI-powered REO disposition platform serving a network of banks.
Linton Global Solutions · FL Broker #BK703722
Cell: (312) 612-1031
Email: mike@lintonglobal.com
Web: LintonGlobal.com
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Schedule a Free ConsultationWorks Cited
- Appraisal Institute. "The Appraisal of Real Estate, 15th Edition (market rent and concessions)." Appraisal Institute, https://www.appraisalinstitute.org/. Accessed Sep 27, 2026.
- Florida Department of Business and Professional Regulation. "License Verification: Michael R. Linton, Florida Broker BK703722." MyFloridaLicense.com, https://www.myfloridalicense.com/wl11.asp. Accessed Sep 27, 2026.
- Florida Legislature. "Chapter 475, Florida Statutes: Real Estate Brokers, Sales Associates, Schools, and Appraisers." Online Sunshine, http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0400-0499/0475/0475.html. Accessed Sep 27, 2026.
Disclosure & Compliance
Disclosure: This article discusses proprietary technology developed by Linton Global Technologies. Michael R. Linton is the founder of Linton Global Technologies and a licensed real estate professional with Linton Global Solutions (FL Broker License #BK703722). This content is for informational purposes only and does not constitute investment, legal, or financial advice.
Compliance Statement: All CREDDS and REOMind.ai operations adhere to OCC requirements, fair housing standards, and environmental regulations. Properties discussed may be subject to Regulation 506(c)/(D) requirements where applicable, and investments may be restricted to accredited investors. Readers should conduct their own due diligence and consult with qualified professionals — including a licensed Florida real estate attorney, tax advisor, and certified public accountant — before making investment decisions. Past performance does not guarantee future results.