Finding the right location for your business can take some time and think. Commercial leases do not offer as many protections for tenants as residential leases, so you should take additional steps to ensure you are making the right choice for your business needs. Here are tips for navigating commercial leases for new businesses.
Research Prospective Locations Carefully
If your business is a retail concern, your store should be located in an area that sees considerate foot traffic. Industrial businesses may need to limit their operations to specially zoned areas, which provide both physical needs, like additional power levels and credibility for the business. You should also research the landlord of any properties you are considering, to ensure they have a good reputation for fairness with their tenants.
Compare Rent Prices
Older, well-established areas can be higher-priced, but very stable from one lease period to another. New construction in commercial areas may have ‘teaser prices’ in their leases, which may be increased over time as the commercial area becomes better known. Some older commercial properties may be on the outskirts of well-traveled areas, but can still offer good pricing on leases.
Consider the Length of Your Commercial Lease
It’s a good idea to research commercial property rental prices over the past 5 years to see how much variation has occurred. This will tell you whether current high prices are likely to moderate, and a shorter lease will be best right now, or whether rental rates are likely to increase in the near future, which means it would be better to lock in the lower lease price for a longer term.
Are There Any Additional Costs or Fees?
Be aware that some landlords add on additional fees for cleaning or maintenance in their commercial leases that will increase the amount of your monthly rental cost.
What Happens If I Need To Break My Lease?
If an economic downturn or other issue causes you to need to get out of your leased property, you will want to know what will happen. In some cases, the landlord can sue you for the remainder of lease payments. Some landlords will find a new tenant for the property to offset their loss of your rental payment. Some commercial leases allow you to sublet the property to another business, so you are left with paying rent for the remainder of the lease.
As you can see, you will need to devote some bit of time to researching and visiting properties for your business. If you follow these tips for navigating commercial leases for new businesses, you will have made a good effort toward finding the property that’s right for your business, at a price that will help your business to grow and succeed.
