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Anytime you’re looking for a commercial space to lease, there are some things to know. One of the biggest mistakes you can make is not taking the time to thoroughly review the proposed lease, which could prove to be costly. Consider these prime items to consider when you are thinking of entering into a lease for commercial spaces.
Understanding the Total Cost
In addition to the initial base rent amount due each month, there may be many additional costs to consider when renting a commercial property. The renter may be contractually obligated under the lease to provide upkeep, repairs, and more. One big mistake is not having a clear understanding of all the costs related to the lease. Some examples of costs that may need to be paid to the landlord once the lease is signed include the following without limitation:
As a prospective tenant, you would want to know the average rent increase, annually, for the geographical location and the space in question as this can vary based on location and demand. Generally, the average rent increase is around 3 percent annually. You would also want to know whether any additional rent due under the lease that is in addition to the base rent amount. You would also want to know the details of reconciliation each year. At times, a landlord may require the tenant to prepay an estimated amount for CAM expenses each month. Where the lease permits for reconciliation, at the end of each lease year, a reconciliation would be completed, and if the reconciliation were to determine that the actual expenses incurred by the tenant were less than the amount prepaid by the tenant for the estimated CAM expenses, the landlord would issue a reconciliation or the difference back to the tenant for the amount that the tenant overpaid. Insurance rates are another significant expense to consider as well as real property taxes since a commercial landlord may require a tenant to pay for these expenses. For insurance rates, it is important to stay informed on potential rate increases and to have a good understanding of the coverage limits and options by acquiring an Orlando real estate attorney. For real property taxes, stay informed on the potential tax increases and have a good understanding of how the property taxes are assessed in your geographical area. An Orlando real estate attorney may be able to offer you some guidance on this.
Know What to Expect From the Landlord
Before you decide to sign a lease, it’s always a good idea to review the lease, thoroughly, to confirm what the landlord’s obligations are under the lease. A commercial real estate attorney Orlando should be able to help you with reviewing and negotiating the proposed terms of the commercial lease. Having open lines of communication with your prospective landlord and establishing a way to connect with one another is a great way to determine if leasing that specific property will be a good fit. If given the opportunity, you should meet the landlord in person – more than once if possible. It’s ideal to have a cordial relationship with your landlord. Even if the location is right and the price is within the budget, it makes sense to ensure that you have clear communications with your prospective landlord, so that you can ensure that all terms are properly addressed, whether it’s one on one or with an Orlando real estate attorney. They can provide you with the support you need to cut through red tape and clearly understand the terms memorializing the proposed lease agreement. Furthermore, if you run into issues with the property or with the landlord, your Orlando real estate attorney can advise you on what steps to take and how to remedy the situation, so you get the best outcome in your specific situation.
When You Need an Orlando FL Real Estate Commercial Lawyer
If you plan to sign a lease for a commercial space, you need the services of an Orlando real estate commercial lawyer. They can help you understand the finer details related to the lease agreement and ensure you have in-depth knowledge of the situation. An Orlando real estate lawyer knows the ins and outs of commercial real estate and how the process of signing a lease agreement works. Anyone searching for a top commercial real estate attorney should contact Nishad Khan P.L. today. He can provide complete client support and offer you essential details for ensuring you have the tools and information necessary to avoid pitfalls and mistakes related to commercial lease agreements.
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