In commercial real estate, a longer lease will usually give you a better rental rate, but many companies are hesitant to opt for a lengthier lease due to worries they'll end up in a space that doesn't suit their needs and be locked in. To decrease your risk of making a mistake when you're selecting a building to lease, do the following:
Consider the Management
Who you're leasing from matters as much as what and where you're leasing. Conduct a Google search to find out what people have to say about the landlord. A bad reputation is usually easy to spot after perusing just a few search results. In addition to doing an informal background check on the prospective landlord, consider what type of property management is in place. Will there be someone available to answer your call if you encounter a problem or have a concern? Where is the property manager located in relation to you? Across town or in another state entirely?
Take Your Time When You Visit
When you visit the building for your site inspection, don't feel rushed or schedule just a few minutes to walk through. Take your time and look at every part of the building. Use your smartphone to jot down any concerns you have or keep a list of pros and cons on paper as you tour. Speaking of your smartphone, make sure that you have service through every part of the building. Make sure to look at how many electrical outlets there are, what the lighting is like and what type of HVAC system is in place.
Do Your Homework
Before you sign a lease, make sure you have done your research to find out more about the location of the building. What is the general area like? Are there any new development projects in the works nearby? Will your employees be able to get to and from work and park with ease? Also, double check the average rental rates in the area for similar buildings to ensure you're getting a fair deal.
Read Every Line of Your Lease
It might seem obvious to say that you should read your lease from start to finish before you sign, but a surprising number of business owners skip this important step or only give the document a quick skim. Carefully read the entire lease and ask for clarification about anything that seems suspicious, out of the ordinary, unclear or otherwise problematic. Don't be afraid to ask for revisions if something isn't right.
Meet the Neighbors
Don't commit to a lease until you've met the other tenants in your building or the owners or managers of the companies located beside it. When chatting with co-tenants, ask how satisfied they are with the level of safety and upkeep. With neighboring companies, see what they have to say about the property and the landlord.
Think About the Future
Last but most importantly, make sure that you have taken the future into consideration before you finalize your lease. Will this building be able to continue to meet your needs throughout the entire life of the lease? Be sure to think about growth and changes to your business model. After all, you don't want to quickly become stuck with too much or too little office space.
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