Even as many companies are transitioning to online and web-based operations, there are numerous North Carolina businesses finding that the key to their success is a brick-and-mortar location. In some industries, such as retail sales, commercial space is the best way to showcase your products; other entities, especially those that engage in professional services, find that face-to-face encounters are critical for establishing trust. If you are seeking to lease commercial real estate, a recent Forbes article offers tips for finding the perfect space.
However, once you narrow down your list of options, you will face multiple legal issues when it comes to working out the details of your commercial lease. These agreements are very different from a residential landlord-tenant arrangement, but there is one important factor you enjoy: You have more opportunity to negotiate the terms and leverage them for your own benefit. Your North Carolina commercial real estate lawyer will advise you on the details and review the paperwork, but you should be aware of the following tips for negotiating a commercial lease.
- Settle on Key Terms Before Negotiations: The starting off point with any commercial lease is determining your budget, and the Balance Small Business has tips on calculating what you can afford based upon different formulas. In addition, you should also identify your business needs in the sense that you cannot do without them. From there, jot down your wants in terms of commercial space, since these can be your bargaining chips.
- Carefully Review the Lease: It goes without saying that you need to read through the documents, but some business owners overlook this aspect when they have already agreed in principle or on basic terms. Pay special attention to provisions regarding:
- Access to the space and security methods;
- Insurance requirements;
- Share of costs for utilities, repairs, taxes, and related expenses;
- Security deposits; and,
- Details regarding common areas
- Double Check Square Footage:. In some cases, modifications made by previous tenants may result in reduced usable space – but the landlord may not have adjusted the base rent to account for it. You do not want to pay for square footage you cannot use, so double check by measuring the commercial square footage and requesting reductions as appropriate.
- Do Not Overlook Your Build Out: There is a good chance you will also need to make some adjustments of your own to the commercial space, but make sure to protect your own interests during the reno process. A landlord may offer to handle a build out for you, as long as you are paying rent. However, if you are doing the modifications on your own dime, this fixturization period should be rent-free.
Our North Carolina Commercial Real Estate Attorneys Will Protect Your Interests
While these suggestions may be useful as an overview, there are many additional details you need to understand when signing a lease for commercial real estate. Our team at Mullen Holland & Cooper P.A. is prepared to review documentation and advise you during negotiations, so please contact us to discuss your circumstances. You can set up a consultation at offices in Gastonia, NC by calling 704.864.6751 or visiting our website.