Signing a commercial lease entails an entrepreneur to specific rights, responsibilities, and duties pertaining to the property. So, before signing and binding yourself to the same, you should be aware of everything stated in the lease.
Some of the major elements to consider before signing a commercial property lease are:
- Research: Before signing a lease, conduct some research into factors such as current tenant dynamics, operation hours of other tenants and your business, the status of current vacancies, traffic patterns in the area, zoning laws, nuisance laws, availability of sufficient parking, etc.
- Rent Structure: Review the rent structure to know how much you have to pay on a monthly basis, the rate by which the rent is expected to increase every year, etc. This information will be useful for determining your budget and figuring out whether the deal will be financially viable for you in the long-term.
- Lease Terms: Weigh the pros and cons of a long-term lease versus a short-term one based on factors such as the amount of flexibility you require (to move locations), the area (whether it is an emerging area or a well-established one), etc.
- Monthly Costs: Assess the amount of money you will have to spend every month before signing the rental agreement. Ask the property owner about the payment structure and terms of property taxes, insurance, interior/exterior maintenance, repairs, utilities, etc.
- Statutes: Be aware of applicable statutes (depending on the state you are in) before signing a lease. You should know about the transfer structure: subletting and assignment of lease in case you plan to close down your business in future, personal guarantees (if your business defaults), holdover rent and non-disturbance agreement (to stay in the commercial building even if the property owner changes for any reason).
- Common Rules: This refers to Covenants, Conditions and Restrictions (CC&Rs) set by the property owner for tenants. Before signing a lease, ask whether the commercial center has CC&Rs. If yes, then read them thoroughly and look out for rules about operation hours, noise levels, sign restrictions, etc.
- Responsiveness: Judge whether the property owner is responsive to the needs of tenants, how after-hour emergencies are handled and other factors. For a clearer perspective on this, ask existing tenants about their experience.
- Property Inspection: Ask for an inspection of the property before signing the lease agreement. Note down verbal agreements arrived at during the walk-through, click photos of existing damage if any, etc.
Contact the agents at John Reider Properties to understand things to consider while signing a commercial property lease. The agents assist the customers in choosing an ideal commercial property on rent. For more details on common things entrepreneurs should know before signing a commercial property lease, visit us at 455 E. Central Texas Expwy Suite 101, Harker Heights, TX – 76548. You can also call at (254) 699 – 8300.