Friday, July 5, 2013

Renting Commercial Property? Free How-To Tips!

Not every business owner starts off in the position to buy a building or office space. In fact, it is likely you won't buy an office space during your lifetime. Most businesses rent. However, there are some ways to end up in terrible leases- well, truth be told, this happens more often than not. So, I've come up with a few tips on how-to avoid entering into a bad commercial lease.

1. Build in renewal options to your original lease contract.
Too often I hear business have to go under because companies are unexpectedly hit with a rent increase without warning from the landlord. Always build in renewal expectations within the original contract so this doesn't happen to you. It can avoid closing down your company, even if just temporarily while you find a new space.

2. Seek out hidden extras, ask before hand to avoid a headache later.
Commercial real estate landlords often tag on extras such as maintenance fees, upkeep for shared facilities (Common Area Maintenance or CAM), and so on. What about utilities? These charges are usually the responsibility of the tenant, but how are they measured? What about insurance? Do you have to keep a certain amount for your fire policy or theft policy? Is electricity use individually metered or apportioned by the square footage? Ask to see these “hidden fees” and policies as well as examples of costs that are typically incurred by tenants. This will help you determine the true cost of the property.

3. Ask for a sublease clause.
Why is this important? Well, a sublease adds some flexibility so that should your business plans change you can sublet your space to another business. You're not stuck paying for empty space or left burning the landlord to deal with the debt at a later date.

Make sure you do business with a reliable people, too. A simple Google search can easy your mind or bring up issues that need to be addressed.

Happy property hunting!

Twyla Garrett

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