The 3 Options Every Commercial Building Owner Needs to Know
By Debora Rodrigues, Licensed Real Estate Broker — Eight Pillars Brokerage & Advisory
You decided it was time to sell your building… but it didn’t sell. Maybe your loan term expired and you feel it’s time to liquidate. Maybe you bought a small office suite in Brickell as an investment back in 2016, a strip retail storefront in Broward, or a small bay warehouse you outgrew and never quite offloaded. Whatever the backstory, you’re now carrying a commercial property you never planned to hold this long.
Here’s what makes the situation especially tricky in South Florida: commercial real estate isn’t “one market.” Retail, industrial, and office are moving in different directions at the same time. Retail vacancy is extremely tight (around 3–3.7% region-wide). Industrial is still absorbing space. Office is where many owners feel genuinely stuck—especially older Class B and C buildings competing against new towers commanding $90–$100/SF in the strongest submarkets.
If your property falls into that stuck category, you still have options. Below are three practical paths owners use right now—without sugar-coating the tradeoffs.
Option 1: Reprice to Today’s Market (and Use a Broker’s Opinion of Value)
If you need the cleanest exit, the first lever is price—specifically, pricing to today’s buyer reality, not yesterday’s peak expectations.
Why this works: studies show your chance of selling can increase significantly when the asset is priced correctly and paired with a strong marketing strategy. A Broker’s Opinion of Value (BOV) can give you an edge before you list by compiling data on your property’s condition, location, competing inventory, and current market stats—so you can align your ask with what buyers are actually paying.
Best for: owners who want a straightforward sale and are willing to meet the market to move on.
Option 2: Become a Traditional Landlord (Lease It, Hold It, Sell Later)
The simplest alternative to selling is leasing the property, riding out the market, and selling when conditions improve.
The upside: monthly cash flow, potential long-term appreciation, and rent that may cover your mortgage partially or fully.
The reality check: you’re now in the landlord business—often without meaning to be. That can mean CAM reconciliations, tenant turnover, vacancy risk, maintenance calls, and the day-to-day management that comes with keeping a commercial asset performing. And in softer office submarkets, finding a stable, creditworthy tenant may not be guaranteed.
Best for: owners comfortable operating the asset and absorbing vacancy/management risk while waiting for better sale conditions.
Option 3: Structure a Lease-Purchase (Often, the “Sweet Spot”)
Option 3 is leasing at a premium to a tenant who is genuinely working toward buying—with real money on the line to prove they mean it. In practice, this is often structured as a lease option: the tenant has the right (not the obligation) to buy later, at a price set today.
This approach can create:
- A stronger effective sale price than a pure buyer’s-market sale—supported by non-refundable option money paid upfront (not a refundable security deposit).
- A tenant who treats the property like an owner, because functionally it’s valuable to them and they may be buying it soon.
- A defined exit strategy instead of waiting indefinitely for a buyer who hasn’t shown up yet.
The honest caveat: it’s not a guaranteed sale. The tenant may choose not to exercise the option. But compare that to waiting indefinitely in a slow sale environment, and many owners find it’s a more realistic bet—not a riskier one.
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Key takeaway: For many beginner commercial landlords, Option 3 is the sweet spot—cash flow without taking on every landlord headache, plus a real path to a sale at a real price. |
How a Commercial Lease-Purchase (Lease Option) Actually Works
Quick vocabulary check, because this matters more in commercial deals than most people think: what many owners call a “lease purchase” is often technically a lease option—the tenant has the right, not the obligation, to buy. A true lease-purchase contract binds both sides to the sale. In commercial real estate, lease options are far more common—and more flexible. (See Wikipedia: Lease-option.)
Most lease-option deals have two connected parts:
- A standard commercial lease — the tenant occupies the space and pays rent, often above what a plain lease would command for that property.
- An option agreement — for a non-refundable fee (the option consideration), the tenant locks in the exclusive right to buy at a price set today, and the landlord agrees not to sell to someone else during the option term.
Depending on how the deal is negotiated, some of the option money—and sometimes a portion of monthly rent—may be credited toward the purchase price if the tenant exercises. If they don’t exercise, the landlord generally keeps the option fee (and typically any agreed-upon rent credits). That structure is exactly why serious tenant-buyers often treat the property like an owner from day one.
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Florida-specific tailwind (effective October 1, 2025): Florida fully repealed its sales tax on commercial rent—state and local surtax both—for occupancy periods from that date forward. See Florida Department of Revenue, TIP 25A01-04. Florida was the only state in the country that taxed commercial rent at all, and this repeal simplifies the kind of rent-credit and option-fee structuring lease-option deals often depend on. |
And if your hesitation is that the office market is in freefall, here’s useful context: CBRE’s Q1 2026 data shows Miami office vacancy at 15.0%—down more than two full points from 17.2% in Q1 2023—with rents up 5.3% year-over-year. (See CBRE Miami Office Figures, Q1 2026.)
In other words: if your building has been sitting, the issue often isn’t “the market.” It’s that your specific asset may need a different kind of buyer than the one you’ve been waiting for—and a lease-option tenant is often exactly that buyer.
A Real Case (and the Lesson in It)
Lease-option clauses aren’t theoretical—they show up in real disputes, and the lessons are worth understanding before you sign anything. In one reported Florida matter, a landlord granted a commercial tenant (a nail salon) an option to purchase within the first two years of a five-year lease. The tenant never exercised it. Later, as the lease approached the end, the landlord moved to sell to a third party, and the relationship deteriorated over a separate rent dispute—not the option itself. (See The Law Office of Lawrence M. Centanni, “Option to Purchase in Commercial Lease”.)
The takeaway: the option window does not need to run for the full lease term. Building a defined exercise window (for example, two years inside a longer lease) can preserve flexibility if the tenant passes—something you want to decide intentionally at the beginning, not after friction starts.
The Honest Risk List (Both Sides)
None of this is meant to scare you off. It’s meant to help you structure the deal with open eyes—and with experienced counsel.
Landlord risks
- Existing financing constraints: if there’s a mortgage in place, a due-on-sale clause could theoretically be triggered by a recorded option—this is a real statutory risk under the Garn–St. Germain Act and is worth reviewing with your lender and attorney before signing, not after.
- Upside cap: if the market takes off during the option term, you may still be bound to sell at the price you locked in.
Tenant-buyer risks
- Non-refundable money: option fees and any credited rent are typically non-refundable if the tenant doesn’t close.
- Financing gap risk: if the property’s value comes in below the locked purchase price when the option is exercised, financing the full contract amount can be harder than expected.
Is Your Building a Lease-Option Candidate?
Every deal is different, but the conversation usually starts with three questions:
- What’s actually keeping this from selling at your asking price?
- Is there a tenant-type buyer in your market who would rather commit to owning than keep renting elsewhere?
- What does your existing mortgage allow (and what does your lender require)?
Debora Rodrigues is the Broker at Eight Pillars Brokerage & Advisory, a commercial real estate brokerage serving Miami-Dade, Broward, and Palm Beach counties.
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Let’s find out together.
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Disclaimer
Eight Pillars Brokerage & Advisory LLC provides real estate brokerage services only. We are not a law firm, accounting firm, or tax advisory practice, and nothing in this article should be read otherwise.
The content of this blog post is for general informational purposes only and does not constitute legal, tax, financial, or investment advice. Lease-purchase and lease-option structures involve legal and tax considerations—including contract enforceability, due-on-sale exposure, and IRS characterization as a lease versus an installment sale—that are highly fact-specific and vary by property, lender, and jurisdiction. Reading this article does not create a broker-client, attorney-client, or advisory relationship of any kind.
Market data, statistics, and figures cited here are drawn from third-party sources believed to be reliable as of the publication date but are subject to change and are not independently verified or guaranteed by Eight Pillars Brokerage & Advisory. Past market trends are not a guarantee of future performance.
Before entering into any lease-purchase, lease-option, or other real estate agreement, consult a licensed real estate attorney and a certified public accountant to evaluate how these structures apply to your specific property, financing, and tax situation.
Sources / Resources
- MIAMI REALTORS® + RWorld
- CBRE Miami Office Figures Report, Q1 2026
- Commercial Observer
- Florida Department of Revenue, TIP 25A01-04
- Journal of Accountancy
- Wikipedia (Lease-option)
- Wikipedia (Due-on-sale clause)
- The Law Office of Lawrence M. Centanni