What could be more fun to talk about than commercial leases? Although they may not be a hot topic of discussion, commercial leases are important contracts that affect many Hatters. Retail stores, industrial shops and restaurants are just a few industries where commercial leases are used. Whether you own and operate a commercial building or you are looking to rent commercial space for your business, I hope to provide you with some tips, tools and considerations for your commercial lease.
Unlike residential tenancies, commercial tenancies are not regulated by legislation. This means there are no basic, non-negotiable rights and obligations given to commercial Tenants and Landlords. The parties are free to negotiate their own terms and conditions. As a result, it is important for the parties to carefully consider and understand the terms, conditions and obligations of the commercial lease before signing.
For many businesses the biggest factor in lease negotiations is rent. Rent is often calculated based on square footage, but the Landlord may also require the Tenant to pay for a portion of the property’s operating costs. Operating costs can include property taxes, utilities, snow removal, landscaping, roof repair, etc. Here are some of the ways Landlords calculate and charge rent:
The amount of rent is important, but other terms of the lease are significant too. You may also want your commercial lease to address:
Taking the time to do some thoughtful planning and negotiating before the lease is signed will save you time and money down the road. Our team at Pritchard & Co. can help you navigate your commercial lease. We can help determine what’s important to you in order ensure your interests are protected. We can provide you with options, help negotiate terms and prepare a lease that meets your needs.