It’s a very exciting time when it comes to leasing your own business premises and shows that your business is progressing in the right direction. Whether you’re moving into your first own office spaces, setting up a store within a retail unit or even just expanding, it’s important to carefully consider the steps which lie ahead of you.
You want the best deal you can get and it is vital that you work out exactly what you want to gain from this commercial lease. So, before you sign on the dotted line, here are some terms, clauses and conditions you should be aware of before you finalise this huge commitment.
Find The Right Property
Location is perhaps the most important factor when it comes to choosing the premises for your small business. Before you decide on a property, you need to thoroughly research the local property market dynamics, such as rental values and tenant demand. Another important factor to consider is the usage of your property.
If you’re setting up a store, then you need to ensure there is high footfall. For a warehouse, you need good transport links and for office space, you need a location which is easy for staff to travel to. If finding the right location and property is proving difficult in the city you are interested in, then a commercial property management team will be able to help out.
Before you sign the lease, you need to double-check whether the commercial property in question has the planning permission for the business you will carry out whilst you occupy the property. You should also carry out a full check of the condition of the property you are renting in the same way you would if you were renting a house or flat and look out for cracks, damp and plumbing issues, as well as other defects.
Get To Grips With The Costs Of Renting Commercial Property
When it comes to renting commercial property, you need to have a good idea of exactly what you can afford. Commercial rent is usually paid in quarterly instalments, with dates typically falling on or around March 25, June 24, September 19 and December 25.
Your insurance and service charges will usually be charged and billed at the same time as the rent. If you are taking out a long lease, then rent review will usually be carried out every three, four or five years and this can alter the amount which you pay over time. You and your landlord are also eligible to carry out your own commercial rent review if you feel it necessary or if an agreement cannot be reached.
Negotiate Commercial Tenancy Agreements
Typically, you will be able to secure a commercial property which is eligible for renting by signing an agreement or lease. This lease is a legally binding contract which also sets out the terms and conditions of a tenancy agreement between the landlord and tenant and it also offers a form of long-term stability.
Leases have become much more flexible in recent years and rent-free periods have become much more prevalent. Break clauses are also more common and give both you and the landlord the option to serve notice at any point during the tenancy without facing penalties. If you were to use a break clause, then you must give your landlord two months’ notice and your landlord is only able to use it if you agree.