Renting a commercial space can be a daunting task, especially if you are doing so for the first time but not quite so if you rent from market leaders like Forum properties. The new entrants always get duped and wrong agreements can wreak havoc on business operations, thus affecting the return on capital investments. Commercial renting may seem similar to residential renting, yet there lies a world of difference in how they should be proceeded with. They vary in a lot of verticals – right from spotting a location to the rental agreements, everything differs. So, what are the dos and don’ts of commercial renting? Read on to find out.
Commercial Renting Do’s
- Research Every Nook and Every Corner of the Area: As much of a time investment it demands, the importance of area research cannot be understated. The key to make a good decision is to make an informed decision. In order to make an informed decision, you need to do a considerable amount of area mapping and surveying even in tight-packed commercial complexes. Visit all the potential sites and survey the rental landscape. This is crucial as the space should be able to hold any expansion of business operations.
- Flexible Renting: Businesses are unpredictable. There can be a sudden growth or a need to cut down the size of the operation. In situations like these, a rigid agreement could incur losses or inhibit decisions. It is advisable to not get into a long term agreement. If you are well informed about the size of operation, there are external factors like location landscape and demographics of people that are beyond your control.
- Negotiate: Commercial space owners always quote an inflated rental price. If you have arrived at a decision, make sure that it’s a feasible one. Commercial renting are heavy investments; a mutually agreeable decision should be made by appropriately negotiating.
- Background Check: A background check is mandated both ways to keep legal troubles at bay. You must access the type of businesses that have rented this space in the past, how they performed and why they moved out. You may also want to check references and seek advice from an attorney for the commercial agreement.
- Don’t Rush into an Agreement: There is no pressure to sign the lease agreement. It is the best industry practice to take time, weigh all options and take an informed decision. Also, don’t take the property owner by face-value.
- Don’t Neglect the Legal Documents: Your lease terms are the operating terms of your business for the next few years. Make sure it is thoroughly checked with no hidden cost, defined terms of cost of maintenance, space loss factor figure and renewal clauses
- Don’t Over-Lease the Space: Space is an expensive overhead, cost – minimization in this sphere isn’t bad if you have just started out. Renting more space than actually required is one mistake most businesses make. Hence, the space needed should be planned accordingly.
- Don’t Avoid Budget: Budget considerations are important. Make sure you aren’t spending all your capital in this domain. There are perks to commercial complexes in the heart of the city, but if you haven’t weighed the long-run feasibility, you need to reassess the options.
Commercial renting calls for industry expertise and professional help is recommended. They not only specialize in lease negotiations but also facilitate the leasing procedure in much lesser time period.