LEASING COMMERCIAL PROPERTY

Are you leasing your first or next commercial retail space?  Is your lease up for renewal?  Not all tenants realize they have access to and deserve representation too – the real estate broker for the property works as the owner’s agent!  Consider the following information before signing your first or next lease agreement.  

Insurance
Commercial leases require a specified level of insurance your business must carry to operate on the leased premises.  The insurance you purchase must include the landlord as the certificate holder or additional insured on the policy.  If the minimum required insurance is not met, your landlord could be held in default of your lease agreement.  Insurance requirements need to sense for your business.

HVAC  
Many commercial lease agreements require the tenant to maintain an active preventive maintenance agreement with a landlord approved licensed HVAC contractor.  In addition, lease agreements often require the tenant to pay for HVAC repairs.  If you fail to maintain a preventive maintenance agreement, you can be held in default of your lease agreement.

Maintenance
The landlord or owner is usually responsible for maintaining the structure, including the foundation, roof, supporting walls, and common areas.  Doors, windows, locks, and lock repairs are generally the responsibility of the lessee.

Additional Rent/Common Area Maintenance Charges
Is your commercial lease a Gross Lease or a Triple Net Lease?  
Does the lease hold you responsible for reimbursing the landlord with a pro-rata share of operating and common area maintenance expenses?  Which items or areas are included, which are excluded?

Right to Relocate
Does the landlord retain the right to relocate your business prior to the end of your lease agreement?  In many instances, they can!  How would relocating impact your business?

Notification Period
How long do you have before your lease expires to notify the landlord of your intentions to renew?  Failing to provide timely notice can significantly impact the terms of your lease agreement.

Option to Renew
Does your current or new lease contain options for renewal at pre-determined terms?  If it does, timely notification during that period is crucial.

Holdover
If you must stay in your leased space after your lease expires, is there a holdover rent rate? This rate can range between 150% or 200% of your lease rental rate!