When a tenant is offered a commercial lease, it's crucial to negotiate terms that protect the business. Here are some key tips to keep in mind:
1️⃣ Take Advantage of Renewal Time
Use lease renewal as an opportunity to renegotiate terms.
Certain market conditions may favor tenants, making the lease more negotiable.
2️⃣ Things have changed? So should your Lease.
Regularly review and update your lease to reflect current business conditions.
Plan for unforeseen business disruptions by negotiating assignment, subletting and/or force majeure provisions.
3️⃣ Scrutinize Operating Expenses
Carefully analyze how operating expenses are calculated.
Negotiate limitations on pass-through expenses.
Secure audit rights and conduct audits to verify accuracy and avoid unnecessary costs.
4️⃣ Avoid Surprises
Thoroughly review all lease provisions, even seemingly "standard" ones.
Pay special attention to clauses like acceleration that could trigger immediate payments.
5️⃣ Seek guidance from both a commercial real estate agent and a business attorney
The agent can help find the best space and negotiate financial perks and savings upfront.
A business attorney will help reduce risk and save money down the road.
These tips are a great start to safeguard your interests and position your business for growth. Whenever I do a lease review, I follow a checklist that has over 200 items on it. Let's collaborate on your lease to ensure no important details slip through the cracks.