A commercial lease is quite different from a residential lease. Not only are the terms and stipulations different, you also have to consider the business aspect of taking on the financial responsibility. You need to be on the lookout for certain items that can end up costing you more than you had anticipated paying. Here are a few things you may need to iron out with the landlord before going any further.
Length of the Lease
Commercial leases are generally for longer terms than residential leases. When starting a new business, the idea of committing to a lease of five years can be scary. An experienced real estate attorney may be able to offer an alternative to a long lease that will be acceptable to both you and the property owner, such as having you pay a bit more per square foot, or a clause that states you will not make any permanent changes to the building.
However, if you are moving or expanding an established business, you may want to sign an even longer lease to give your business some stability. If this is the case, and you can prove you have the ability to warrant a longer lease, the property owner may be willing to pay for some of the work needed to make the property fit your needs. This can include building the interior of the place to suit your business. In either case, when you sign a commercial lease, you want it to contain a clause stating that you have the right to a new lease at the end of the current one, and that the lease will remain in effect even if the building is sold.
Favorable clauses are those that will benefit you. They often include one for subletting the building if you need to move or close your business. This can be very important and save you a lot of money on an early termination of the lease. Favorable clauses also include how and where you can place signs for your business. If there is a pole sign out front already, be sure you are allowed to add a sign to it. Make sure you understand any limitations on the size of all signs too. Having a non-compete clause can be very important if you are in a strip mall location. This means that no business that is similar to yours may rent other stores in the mall. For example, if you are a shoe store, no other shoe stores may rent in the mall. However, this does not mean that a store that sells many things, including shoes, cannot be there.
As with any legal document, it is always a good idea to have a lawyer look it over before you sign it. A real estate attorney can look for hidden expenses you may not consider. He or she may also help you to understand your rights and your obligations to the lease. A good business person has advisors; use them wisely.
For a real estate attorney in your area, contact a law firm such as Brandt Law Group.Share