Introduction
Leasing of commercial real estate is one of the most promising and yet, very relevant markets today, and due to such conditions, it would attract investors, entrepreneurs, and businesses among others. For first time newcomer’s it may seem like a very daunting task, but as long as you have your standards and basic requirements met as well as some tips on the inns and outs of searching for commercial property the journey is well on its way to its completion.
Business real estate renting refers to the renting or leasing of premises for business use. The rental is usually longer than residential tenancy agreements and can be anywhere between three to ten years or even more but based on the industry type and property type. There are quite distinct differences between commercial leasing and residential leasing in terms of size of the property, the length of lease, level of tenant improvement and consideration of location and zoning.
Here within this ultimate guide, allow us to take you step by step through the commercial real estate leasing basics. Let’s talk about properties; the types, locations, how to select the right property, how to negotiate and leasing agreements. After reading this article, you’ll be ready to lease the right commercial property for your business.
An overview of Commercial Real Estate Leasing
The types of commercial property that are available for rent include; A. Industrial premises B. Business premises C. Agricultural and horticultural premises. Some of the most common commercial property types include:
1. Office Space: Properties of this kind suit well for business ventures that capital will invest in including provision of professional services like law, accounting, consultancy, and manufacturing banking being some examples. Offices are available in various dimensions ranging from stand-alone single tenant buildings to multi-story complex structures with facilities for example, conference rooms, break areas and car parking.
2. Retail Space: The retail spaces are appropriate for organizations, which offer products or services for purchase to the final consumer. This concerns retail stores, eating establishments, the coffee shops and other businesses that are in the service industry. Mostly, retail stores are located in areas with traffic, such as mall outlets, in the central business district, and on strip mall outlets among others.
3. Industrial Properties: These properties are intended for use by manufacturing, warehousing and distribution companies. Industrial spaces include manufacturing facilities, storage, and distribution buildings and are typically situated in locations with touch access to transport systems.
4. Flex Spaces: Flex space, or flex property and light industrial property, are commercial properties that are suitable for varied utilizations such as light manufacturing, research and development and office purposes. These properties are normally located in suburban or industrial regions.
5. Land: Employment of vacant land may be necessary for construction of the intended commercial property by some organizations. Land leasing concerns reaching a lease agreement on the land and then, putting up the building to suit the purpose of the business.
Finding the Perfect Space
Selecting the right place to open your business is not just easy; a lot of thinking and consultation should be made. Here are some steps to help you find the ideal commercial property:
1. Define your business needs: Some of the items that describe your business needs include; the size of the property, the preferred location, required rents, and specific characteristics like parking space, signage, or special services.
2. Research the market: Information available through these websites can help you identify available properties that can suit your needs, these include; Commercial real estate listings, broker websites, local chamber of commerce websites among others. Go through local business forums, membership and other influential industries meetings with purpose of updating on the next events and possible opportunities.
3. Hire a broker: But hiring a commercial real estate broker can be very helpful to you in following up on the leasing process besides saving your time. A good broker will be able to advise where to lookout for properties to lease, negotiate lease deals and give an insight of the market with regards to the lease deal that you intend to sign.
4. Visit potential properties: Arrange for viewing by property of common features of the schedule the properties that meet a tour. While on the site, it is important to make a judgment of the land use, parking, and transportation, surrounding commerce, and population density.
5. Assess the competition: Study other related firms to find out whether the location will be advantageous to your business. Elements like the number of people that are likely to pass through the business area, the area accessibility and other business that will be located near the business.
Lease Agreements – How to Successfully Negotiate One
If you have been searching for the right commercial property for your business, the next thing is to look for a rental agreement. Here are some tips to help you get the best deal possible:
1. Know your goals: In advance of entering the negotiation, decide what is most important to you: rent, the length of the lease, rights to expand, and the state of the space when you take it. It is preferably to be ready to make compromises but at the same time, it is crucial to think of the needs of a business.
2. Understand the market: Check for the going rent, in other similar buildings in the locality, so as to come up with the correct market price. This would make it easier on you when you barging for the property and decreasing your chances of over paying based on what the landlords dew expect.
3. Inspect the property: So in terms of lease agreements it is advisable for the tenant to do a physical check on the property to note issues and hitches that are impending. This will make it possible for you to bargain during negotiations to lift or reduce rents the way you want them.
4. Consider tenant improvements: The landlords may be in a position offering to bear part or full cost of tenant improvements as a way of acquiring quality tenants. Talk with the landlord regarding the options offered to complete improvements and obtain specific estimates from contractors to check the best realistic prices.
5. Review lease terms carefully: Read the letter agreement word for word, and if you need to, consult a lawyer. Some terms may include, but are not limited to, rent abatements, options to renew the lease and terms providing the lessor with the option to terminate the lease. As much as possible, read all the fine prints of the contract before signing anytime.
Conclusion
Leasing commercial property can be a tough nut to crack, but with these tips you will be able to quickly and effectively find the right property for your business. Note that CRE leasing is more or less a continuous business association between the lessor and lessee, so it is prudent to engage the services of a tenacious broker as well as understand the corporate requirements of your enterprise.
Make sure to always go through the lease agreement and know when it expires to ensure you adapt to the current market trends. It is crucial nonetheless to understand how the commercial real estate leasing market functions and get the proper approach if you want to obtain an office that will let your business develop and thrive.
