5 Things To Look Out Before Leasing A Commercial Property
Signing a lease for commercial property for your business rather than buying it has its perks and benefits, for which many people consider leasing a commercial property. But, when you have little or no idea about the commercial real estate market, leasing a commercial property can be pretty tricky for you.
There are many things to be looked at if you are in need of a commercial rental property.
Here are some really important things to watch out for before leasing a commercial property to avoid any possible legal or financial problems in the future.
Here Are The Top 5 Things To Look Out for Before Leasing A Commercial Property
Overview:
- Location and other essential details.
- Understanding the agreement.
- Negotiation.
- Other related expenses.
- Exit plan.
1. Location and other essential details:
Location is one of the most important subjects you should know about in detail before taking any commercial property on lease.
Depending on your business, it should have ample space for your customer to walk in, park their cars, or transportation, and other specifically required services should be nearby to avoid management difficulties in the future.
You should find out about the environmental laws of the preferred location as they can create some significant legal headaches in the future if ignored.
In addition, you should ensure that the space you have taken on lease for your business matches the standard zoning laws in the area. You should also have a brief detail about the landlord and the legal information of the property you will take on lease.
2. Understanding the agreement:
Before signing the agreement, you should ensure you completely understand the whole agreement. You should read every clause of the agreement to understand the rights and responsibilities of the tenant as stated in the agreement.
If you take this part lightly, you may end up signing an agreement that favors your landlord most of the time, which can hamper you financially in the long run. As we all know, it’s also very important to know what will and won’t be allowed while signing the agreement.
Taking the help of legal business lawyers can be helpful for you while leasing commercial property. They can guide you through the agreement and help you grab the best deal out of the agreement.
We suggest you hire Lord Commercial Lawyers because they have expertise in understanding the difficult clauses of the agreement and negotiate them for you if suitable and beneficial.
3. Negotiation:
You might not know, but many parts of the agreement are negotiable if you are ready to sit down with your landlord and make your landlord know that you are not completely satisfied with some of the parts of the agreement without hesitation.
You will be stunned to know how much the deal can be negotiable in your favor. Therefore, you should negotiate freely to ensure the best deal for your business.
4. Other related expenses:
There are a bunch of expenses related to a commercial property. You should know while signing the contract about those expenses and how much expense will be taken care of by your landlord and you.
Some of the obvious expenses are repair and maintenance and other basic utilities. Generally, they are to be paid by tenants, but the agreement should mention the limit on the amount spent on repairs by tenants on the leased property.
All of the taxes related to property should also be discussed, and it should be clearly stated who will be responsible for paying them.
Another important thing which should be mentioned in the contract is how and when the rent will increase. By this, we mean you should know in detail how much and on what basis the landlord will increase the rent.
The agreement should also state the amount of time the rent will remain constant. This will help you decide your lease tenure and plan your expenses.
5. Exit plan:
The plan to exit is also equally important. So, you should be ready with your exit strategy also. Make sure the agreement talks about the exit part also thoroughly.
If any unexpected situation arises in the future, and leaving the premises before the completion of lease tenure is the only option left, you would land in great trouble, and you have to pay the penalty in such a case.
You should also have negotiated the penalty you have to pay in case you decide to leave the property before the tenure of the lease expires.
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