Signing a commercial lease can be an exciting process. You might have found the perfect premises for your business in a brilliant location, and all that’s left to do is sign on the dotted line. As tempting as it can be to skim through the fine print and start moving in your furniture as soon as possible, it’s essential to take your time. People in the same position as you have rushed the process and made some of the following mistakes.
Not Getting Expert Help
Whether it’s your first, second, or third time signing a lease, it can be worthwhile to have commercial real estate brokers like Jeff Tabor Group on your side. Not only can they assist with helping secure your ideal office space, but they can also help protect you from unexpected costs in your lease agreement you might not have anticipated, such as parking and tax costs and building maintenance expenses. Commercial real estate brokers can tap into their years of experience to ensure you’re getting the best deal, prioritizing your needs above those of the investment property owner.
Failing to Negotiate Terms
The average commercial lease agreement can typically favor the landlord rather than the tenant. You might be more than satisfied with the annual lease expenses, but that doesn’t mean all terms within your agreement will be to your liking. Don’t be afraid to negotiate with the landlord to see if you can tip some of the clauses in your favor.
For example, if the landlord includes a lease term you must abide by, see if you can negotiate a shorter or longer period based on your unique needs. You might also look at your subleasing rights. Including a clause about your ability to transfer a lease to another business might give you peace of mind if you decide to relocate or close your business.
Not Researching Zoning
You might assume you can use any commercial property for your business needs as long as you pay your lease. However, that’s not the case due to zoning laws. Zoning laws give state and local governments authority over privately owned property, especially regarding open spaces and residential, agricultural, and commercial properties.
Ensure your business practices align with what’s allowed in that particular zone. For example, you might be unable to undertake industrial work inside a predominantly residential area, even if your building seems suitable.
Not Clarifying Your Outgoings
It’s not always clear whether outgoings, such as land tax, water, and electricity, are included as part of a lease agreement. Clarify this point to ensure your chosen property falls within your budget. Some landlords provide an all-inclusive cost, with no separate charge for outgoings, while others require you to pay all or a portion of outgoings on top of your lease payment.
There can be a lot to think about when you look for new premises for your business. Not only do you have to find a property you like in a suitable location, but you have to make sure the commercial lease agreement gives you the freedom to operate your business as you wish. Avoid making these mistakes above, and you might be on your way to finding the best commercial property for your needs.
Photo Credit: Tony Pham