Small business owners often think that a landlord’s lease is final and that they must take what’s presented to them without debate. However, most landlords are willing to work with business owners because they do not want a vacancy in their shopping center, office building, or other property. This is where business owners may negotiate lease terms before signing.
Once the business owner has a property in mind, contacting the landlord or his or her in-house leasing agent or broker is the first step. The landlord will then draft a letter of intent, which is a short letter that contains the property’s base rent, move-in date, and other stipulations. If the tenant agrees to those terms, the landlord will then deliver a commercial lease. If the landlord or tenant does not agree to the lease, often the terms of the lease can be negotiated.
Many business owners are surprised to learn that they can negotiate certain terms out of a lease as well as into the lease. Business owners should keep this in mind when discussing particular lease terms with their potential landlord.
Commercial lease terms typically run anywhere from 5 to 20 years. Before deciding on the term length, business owners should consider various elements including whether this is his or her first venture, whether the business is a franchise, and other factors.
The commercial lease will contain several important lease provisions, and every business owner should carefully examine the lease before signing, preferably with the help of an attorney who specializes in business and real estate law. Below are only a few of the common provisions that tenants should be aware of before signing a lease.
Commercial lease negotiation is best accomplished with the help of an attorney. The business and real estate attorneys at O’Reilly Rancilio represent both landlords and tenants with lease negotiation and more. For more information, please call 586-726-1000 or visit our website.