Sign Rights for Office Tenants
A few days ago I got a phone call from someone, a physician, that I didn’t previously know. He had a question for me, as he wanted to know how a Landlord decides what tenants get their name on the monument sign outside an office building. He seemed to be under some impression that there was some hard and fast rule that determined what tenant names a building owner would allow on the monument sign. He asked if how long you have been in the building (seniority) or how much space you leased mattered.
I suspected this doctor was upset because the Landlord wouldn’t allow his name on the exterior monument sign because there was not currently a slot available, and I was correct. After asking a few questions, I uncovered he had approached the Landlord about getting his name on the monument sign because a tenant was rumored to be moving out of the building, which would open up a slot on the monument sign and we wanted to be number one on the waiting list and his request was denied.
This particular doctor was surprised when I explained that who (which tenants) a particular building owner grants building or monument signage identity is strictly up to the building owner and is a concession that is negotiated and there was no official formula or rule. I explained the size of a monument sign or the number of names allowed on a particular monument sign can be subject to zoning, local governmental restrictions, or deed restrictions, but it is totally up to the Landlord.
He wanted to know if I could negotiate this concession with the Landlord, for him now. The problem was that he was approximately two years into a ten-year lease and I explained this was not the most prudent time to be requesting this concession from the Landlord, and that is something his broker should have done or at least asked about if it was important to him before he signed the lease. Well, of course, his answer was “I didn’t use a broker.”
So what kind of signage/identity options might building owners grant to a tenant of a multi-tenant office building?
Exclusive Building Signage: In this case, the tenant has exclusive rights to have their name affixed somewhere on the building typically at the top of the building. This is typically reserved for an anchor tenant who leases the most space or the majority of the building, typically multiple floors.
Building Signage: Signage can also be on the side of the building but may not always be at the top. In some cases, I have seen more than one tenant have building signage rights with one tenant having superior rights (top of the building) but another tenant having signage rights somewhere else on the building or property such as the parking garage.
Exclusive Monument Signage: In some cases, a tenant may negotiate the right to have a stand-alone monument sign featuring their company exclusively.
Monument Signage: Typically, an office building will have a monument sign with multiple tenants listed on the monument sign. The number of tenants listed varies and may be as few as 2 or 3 or as many as 5 to 10.
The primary reason companies make significant investments in their office space is to attract and retain employees as well as make an impression on their customers. In many cases, signage rights are considered an attractive value-add to their marketing expenditures. Branding is a priority in today’s competitive economy and building signage at any level is often considered effective advertising.
So how do you get building signage or monument signage rights? First, you have to ask before you sign the lease whether or not you can achieve this concession is all about negotiating leverage. The amount of space you lease, the prestige of your company in the Landlord’s view, market conditions, and the building situation all come into play. Larger tenants obviously have a better chance of obtaining this concession.
Signage rights are not critical or even important to some companies, but if it’s important to your business, make it part of the lease negotiations.
