Your Guide to Commercial Real Estate Rent Negotiations
As a commercial tenant, having a lease that favors you can set the foundation for lasting business success; therefore, it is critical to ensure that the commercial property lease you enter in to is fair while favoring your needs. Since a lease document can define the relationship you have with your landlord, you should be aware, during the negotiations period, that it is crucial to arrive at mutually agreeable terms that will continue to benefit both parties for the term of the lease. However, hiring Commercial Real Estate Attorneys in Orlando can play a critical role in negotiating favorable rent terms.
Guide to Commercial Real Estate Rent Negotiations
Know your needs
One of the first steps to effective commercial real estate rent negotiation is to ensure that you have a strong grasp of what you are looking to get from the property and what are the terms you are looking to negotiate on within the lease. Even if it is the square footage, zoning needs, location, amenities, or other needs, you should make a list of what you are looking for before starting to search for a property. In case that appears helpful to you, Central Florida Commercial Real Estate Lawyers can help you put together a list of your wants and must-haves to assist you with your search for a property.
Financial backup plan
Before the negotiation process, the Orlando Commercial Real Estate Attorneys will ensure that you gathered your financial documents to prepare to answer any financial questions related to the lease. In the case you are a business starter, you will need a backup plan so that your landlord can easily accept your offer. The backup plan can include guarantees of payment and financial statements (income statement and balance sheet). In this case, offering a personal guarantee might help you in the negotiation. A personal guarantee will demonstrate that you can personally pay the rent if your business cannot manage. You might also be required to have a co-signer who will guarantee to make the commercial lease payments if you are unable.
Due diligence involves more than preparing the documentation and researching the market. In this case, Orlando Commercial Real Estate Attorneys can help you. A professional real estate lawyer near you will assist you in determining what you are looking for in a property and whether any potential property will meet your needs. After you have identified a property, Orlando Commercial Real Estate Lawyers will help you conduct various inspections on the subject property and research other aspects of the subject property, such as:
- Whether the property fits your predetermined budget
- Whether the condition of the property is suitable for your intended purposes
- Whether property is zoned for your intended use
- Whether any use restrictions exist on the property
- Whether any building restrictions exist on the property
- Whether any environmental contaminations exist on the property
- Whether the square footage advertised is the actual square footage to be leased
- Whether the advertised rental rate coincides with the market rate
- Whether there is adequate parking for the property’s intended use
- The vacancy rates associated with the leasing of the property
- The landlord’s reputation in the market
It is understandable to feel like commercial real estate leasing involves a lot of different factors; fortunately, a real estate attorney can assist with the research process.
Request clauses that will favor you
In this case, Commercial Real Estate Lawyers in Central Florida can request that certain revisions be made to the proposed lease, which are more favorable to you as a tenant. Orlando Commercial Real Estate Lawyers will advise you on various topics, which should be addressed within the proposed lease, such as:
- Identification of the premises
- Identification of personal property items included in lease
- Each party’s insurance obligations
- Each party’s maintenance obligations
- Cash allowances
- Landlord’s cooperation
- Grace or cure periods
- Non-compete provisions
- Options to purchase or renew the lease
- Delineation of any Common Area Maintenance (“CAM”) charges
- Subletting or Assignments
- Lease termination
- Financial reporting
Research for additional costs
Some commercial real estate properties do have additional costs. For instance, you might rent a property, and end up realizing, after you rent it, that you are responsible for certain cleaning, upkeep, or maintenance costs. Therefore, Commercial Real Estate Lawyers in Orlando will conduct the proper research to help you find out whether the property has any additional costs that are charged to the tenant, so that those additional costs can be negotiated.
When you rent a commercial real estate property, you will want to ensure that your interests and rights are protected. Fortunately, Orlando Attorneys at Nishad Khan, P.L., are knowledgeable in every aspect of real estate law in Florida and will negotiate on your behalf so that you reach an amicable deal.