Before you start looking for a great warehouse space for rent for your company,you need to get informed about the commercial property leasing process. Being prepared will prevent you from making impulsive decisions and costly mistakes you will probably regret later on. The following are some insider suggestions to help make an informed decision when letting a commercial property your business
Initiate the process of locating commercial space at least 6-12 months before your current lease terminates or until your ideal move-in-date. Finding the right space and negotiating the deal alonewill require 1-2 months depending on the size area and current market conditions. Typically the spaces you like will need some sort of tenant improvements that the time needed will depend on the scope of work.
completely analyze your company’s current and future needs. Consult with the different department heads for input in addition to some key employees.
Get acquainted with allthe commercial space terms and meanings. Different landlords say and quote things otherwise. If you’re in doubt about what they mean do not be afraid to ask them to supply more info.
If you’re not familiar with the commercial rental process or the current market conditions then consider engaging the support of a tenant representative. Their services do not cost you anything since building owners pay all of the rental commissions. The landlord rep will have an experienced listing agent representing them so it would be a good idea for you to have one as well.
Personally see all of the spaces that meet your requirements so you can make a short list. Keep in mind that the layouts can be reconfigured so don’t get stuck on that. Ask the landlord agents a great deal of questions about the ownership,property amenities,required lease duration,how much the landlord is prepared to give in tenant improvement allowances,etc..
Do not settle for the first commercial properties you think is acceptable for your requirements: continue looking until you have at least two to three alternative options. These extra options will work to your advantage since you will know what to expect during the lease negotiations and you’ll gain more leverage with multiple building owners competing for your tenancy. They also give you something to fall back to whether the discussions to your first choice go sideways.
Send out proposals to your top three to five options. These are not legally binding. You never need to take a landlord representative’s verbal note. Everything should be in writing.
To help you decide what property is best suited for your company,prepare a spreadsheet to do an apples to apples comparison of every property. Some of the things you need to put into consideration include the size of this distance,the inquiring foundation rental rates,the necessary lease term,and the incremental costs (taxes,insurance,maintenance,etc). It is also possible to take note about the advantages and disadvantages of each property. If you’re budget conscious then you can quickly narrow down the list by simply calculating the monthly base rents for each property then removing those which are way over your budget. The monthly base rent is calculated by multiplying the industrial space square feet by the asking base rate plus any operating expenditures then dividing by 12.
If some of the commercial spaces need tenant improvements then it’s important that you figure out what improvements you want on each and get preliminary bids. That way if the landlord is offering a tenant improvement allowance you will learn how much out of pocket you’ll need to pay over and beyond what the landlord is prepared to give.
Carefully examine and compare the terms of each proposal. Consider whether it makes sense to go back to every landlord to negotiate additional concessions. Make certain you fully understand the total expenses you’re expected to cover. Do not get emotionally attached to a specific property until the discussions are over. Emotional attachment might lead to you signing a contract your business can’t live up to.
After discussions are finalized and you have made your selection now it’s time to have the landlord offer you the first draft of this commercial lease contract.
Now it’s time to reassess the commercial lease contract. It would be advisable for you to hire an attorney to review the lease. If you have a tenant representative then they can review the lease with you as well. Commercial lease language can be negotiated. If you do not like certain lease items or want to propose new language today is the time to do so.
When the end of lease contract negotiations has finished the landlord will give you a draft of the lease to review.
There are many more things to think about when renting commercial space however these tips will help get you going. If you’re a new company renting commercial property for the first time or an current company who has only leased one or two spaces then consider getting help from a tenant rep. Their services don’t cost you anything and you’ll save a great deal of money and time.