Are you thinking about renting commercial real estate? Whether you’re leasing retail space, entering into an office lease agreement, or searching for distribution warehouse space, renting commercial real estate is a major milestone for any business.
Regardless of the industry or nature of your business, the decision to rent commercial real estate is one that should not be made lightly. Although there are a number of benefits to renting commercial real estate, such access to warehouse storage, it’s important to ask yourself a few important questions before officially entering into a commercial lease agreement. Here are a few to get you started:
Did you thoroughly read the lease agreement?
Although this question may seem like a bit of a no brainer, it’s important nonetheless. Leases are length documents that are often tedious and time consuming to read, which makes it incredibly to skim through and casually glaze over their contents. Don’t make the mistake of doing this, as you may unknowingly gloss over important information that can directly affect your business operations. Be sure to thoroughly read through the lease agreement, word for word and line by line.
Do you fully understand the lease agreement and all of its terminology?
Just like residential leases, commercial leases are legally binding agreements that have serious financial and legal consequences if not upheld. Saying that you didn’t fully understand the terms of your lease is a poor excuse that simply will not hold up in any court of law. Be sure to ask the landlord or property manager to clarify any terms within the lease that you do not understand. You may event want to get this information in writing, such as in an email, for your own records and safekeeping. Furthermore, consider having a commercial real estate attorney review the lease.
How long is the lease term?
Though the length of a commercial lease can vary, they are typically between 3 and 10 years in length. Before signing on the dotted line, it’s important to keep this in mind and consider its significance. How will the surrounding area or neighborhood change during this time? How much revenue is your business generating? How much flexibility do you have in terms of renovations and repairs? Take the time to carefully examine these factors from every angle before renting commercial real estate of any kind.
Renting commercial real estate has many benefits and can help a business significantly improve its operations. Before you can reap these benefits however, it’s important to thoroughly consider the lease terms and how they can impact your business down the road.