Are you considering taking on a commercial lease?
Lease agreements are complex and can run to hundreds of pages. What’s more, Landlords usually have more experience than business tenants when it comes to getting what they want. Here’s our handy guide to choosing your first premises and getting your first lease negotiation over the line with a win-win result.
When it comes to choosing the right location for your business, consider these factors:
- Accessibility: How convenient is the location for your employees and customers? Think about proximity to public transportation, motorways, and parking facilities. Ensuring easy access is key, and don't forget to consider amenities like restaurants and banks that can benefit your business.
- Local Business Rates: Before committing, it's wise to check the local business rates, as they can vary depending on the location and property type.
- Type of Space: Determine the type of commercial property that suits your business, whether it's office space, retail space, industrial units, or coworking spaces.
- Space Condition: Make sure to inspect any property you're interested in to ensure it meets your business needs. Assess its condition and suitability before deciding.
Lease Terms and Costs
Understanding the lease terms and costs is crucial. Consider the following:
- Rent: Get a clear understanding of the total cost of rent, including any additional fees like service charges and insurance.
- Lease Duration: Check the length of the lease and inquire about any break clauses that may provide flexibility.
- Rent Review Clauses: Be aware of rent review clauses and how they are calculated to avoid surprises in the future.
- Service Charges: Clarify what services are covered by service charges and inquire about how they may change over time.
Don't overlook these important legal considerations:
- Lease Agreement Review: Carefully review the lease agreement before signing to ensure it aligns with your expectations and discussions with the landlord. Familiarise yourself with the terms for terminating the lease, including notice periods and associated costs. Seeking legal advice may be prudent.
- Repairs and Responsibilities: Clarify who is responsible for property improvements, repairs, and maintenance. Ensure the lease agreement addresses these issues and outlines the landlord's obligations.
- Insurance Requirements: Review the insurance requirements, including liability coverage and property insurance, and ensure you have the correct insurance in place for your business.
- Health and Safety Compliance: Verify that the property meets health and safety regulations and has appropriate security measures in place.
Establishing a good working relationship with the landlord or property management company is essential. It allows you to address any concerns or issues that may arise during your tenancy.
Now armed with these tips and considerations, you're ready to negotiate the perfect commercial lease agreement and set your business up for success! Good luck
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