Many businesses negotiate commercial leases with landlords. This is especially beneficial for businesses that are just starting and can not afford to own a building.
Most commercial leases are negotiable. Here are a few matters that business owners may need to discuss with landlords:
Lease length
It is important for businesses to know how long they can reside in a building. Business owners may need to negotiate the length of a lease with the landlord to help ensure they stay in their location as long as they are comfortable. If a business owner expects to grow in a short amount of time, they may want to consider a shorter lease duration. However, if they want to stay in the community and believe this is the best available spot, then a longer lease may be needed.
Rent costs and increases
Alongside the length of a lease is the cost of rent. Most rent payments are made month-to-month. However, the cost of rent may increase over months or years. Agreeing to a longer lease with rising rent costs could greatly impact a business’s profits.
Security deposit
A business owner may need to discuss with the landlord what kind of security deposit they expect and what is required to help ensure the owner returns their deposit.
Repair responsibilities
There is always the likelihood of damage to a property. This may be caused by typical wear and tear or accidents. A business owner needs to know whether it is their responsibility to make repairs to a property or if it is the duty of the landlord.
Property alterations
Many businesses have to alter the space they reside in to accommodate their operations, such as building walls and attaching signs. A business may need to make certain sacrifices depending on whether it can alter a property.
Business owners can benefit from learning about their legal rights when negotiating the terms of a commercial lease.