Whether purchasing your first commercial space or entering into a commercial lease, you want to get the best deal possible. The commercial markets constantly change, so small business owners often turn to legal experts for guidance, particularly when negotiating a lease.
Before signing a new commercial lease, use the tips below to negotiate fair terms for your new commercial real estate lease.
Leave nothing on the table
When reviewing a commercial lease, you will want to discuss every aspect of the new property. Each item, its price and legal weight is negotiable, including taxes, maintenance, utilities and more. Many entrepreneurs will consult a local lawyer familiar with Georgia’s evolving real estate laws for advice.
When negotiating your new lease, make sure to understand each of the following items:
- Lease length: A lease’s term length is central to most negotiations. Many landlords will offer other benefits in exchange for longer lease terms, including covering maintenance or utility costs. Landlords will offer enticing leases with extended terms to lock down income, but a shorter lease will allow you to assess the space properly.
- Monthly rent: Landlords will often include rent increase percentages and caps in the terms, slowly increasing the cost of the space over time. They may include utilities, taxes, maintenance and more — a lawyer can help narrow down your options for your business’ projections.
- End of lease: Make sure to discuss ending the lease, including required notification periods and options to cure rent default before eviction. The events of 2020 will demand more diligence from lessees to protect their interests.
- Property maintenance: Leases will have terminology concerning the responsibility of property maintenance. A lawyer can help negotiate who takes care of HVAC, roof repairs, plumbing and general maintenance. Monthly dollar caps on maintenance costs can help control costs.
- Clauses: Landlords will include many clauses that favor and protect their business interests. A lawyer can help negotiate clauses that protect your business from unforeseen health emergencies, work stoppages or other “acts of God.” Non-compete clauses can prevent the landlord from leasing a neighboring property to a competitor, and clauses outlining dispute resolution can protect you legally.
A local attorney can help draft your next lease
If you hope to start or expand a business soon, you can bring your commercial real estate questions to a local lawyer familiar with Georgia’s real estate laws.