When the time comes to start your business or open a new location, the moment of signing the commercial lease can be thrilling. Rushing into the agreement can sometimes be a detrimental decision, however.
Business experts outline some of the key considerations that entrepreneurs should keep in mind before committing to a lease. By understanding these need-to-know tips, you can proceed with confidence and start your latest venture on the right foot.
Your legal restrictions
When you sign a legally-binding lease, you agree to certain terms provided by the building owner and landlord. Additionally, you should also know the zoning laws, environmental laws and nuisance laws for the neighborhood in which you will be conducting business.
Your payment obligations
Some leases lump all expenses into one accumulated monthly payment while others separate expenses into separate categories and transactions. Know your obligations pertaining to maintenance, utilities and insurance, as well as where the responsibilities lie for funding repairs.
Your transfer privileges
Your commercial lease should explain your rights for transferring the lease to another party via assignment or subletting. This will become especially relevant if you decide to close or move your business before the lease ends or if you are not using the entire property and wish to rent the extra space out for a profit.
Entering a lease agreement without knowing all the details and pertinent laws can lead to serious misunderstandings or even disputes down the line. If an argument does arise between you and your commercial landlord, you can protect your interests by working closely with your legal team.