As a new business owner or entrepreneur, your excited to start your business and build out your dream location and begin to sell your services or merchandise. Before you sign the lease that was given to you most likely by the landlord for that new store or office you should keep in mind that it was most likely written to protect the landlords interests and not you as the tenant.
Commercial lease agreements are typically lengthy and wordy documents and provide for all manner of issues related to the premises. Aside from providing the stipulated rent and other common provisions, they include topics such as who is responsible for the maintenance of the building, who will pay the property taxes, etc. It is important to review very carefully these agreements to insure that you as the tenant are aware of your responsibilities.
Did you know that:
- You can negotiate with the Landlord for tenant improvements in the form of monies provided by the Landlord to be used for the build out of your location;
- You can negotiate an exit strategy in the event that your business does not do as well as you hope;
- You can negotiate when your lease starts, meaing not when you sign but when your are actually ready to open, the allows for you to make your improvements or remodeling to the location without having the burden of making lease payments;
- You can negotiate the rental increases.
Tenants should be knowledgeable about what they are signing, Landlord’s typically want the business owner to sign a personal guarantee when entering into a lease, this can be problematic when the lease contains an acceleration clause which allows for the Landlord to collect the remaining balance of the rental term and personally sue the guarantor for payment.
It is important to have these complicated commercial leases reviewed and negotiated prior to signing by an attorney who is knowledgeable in the area, it will be the best investment your new business can make.