If you own a startup, then you may have looked into the idea of signing a commercial lease for office space. Leasing as opposed to buying your office can save you a significant amount in upfront costs.
Residential leases are different from commercial ones in the former often adhere to a standard format and remain in effect for a year or less. Commercial ones often cover several years and vary in scope.
Standard details that typically appear on commercial leases
Although they may not have a standard format, there are some details that should be included on virtually every commercial lease. One piece of information sure to be there is both the rent and what may lead to it being increased.
Before you sign the lease, you’ll want to verify the total rent due. You’ll also want to read through it to see who’s responsible for making repairs, covering utilities and paying insurance and property taxes. You’ll also want to find out how often rent increases are expected to occur and whether they’ll come in the form of yearly percentage increases.
When you read over the lease, it’s important for you to see how the leased space is described as well as any policies for posting signs advertising your business.
The contract should also clearly describe the lease terms and what the security deposit is. Whenever possible, you should aim for a shorter lease with a renewal option. When reviewing your contract, you’ll want to make sure that the deposit listed aligns with what you’d previously discussed and the obligations that you must meet to ensure you receive it back at the conclusion of your lease.
If you have competitors, then an exclusivity clause in the contract may be necessary to ensure that no other space in the building will be rented to them. If you’re newly incorporated, then having a sublet clause included in it will ensure that you won’t violate the terms of your lease if you have relocate or cease operations.
Why you should have an attorney review your lease
A commercial lease can quickly become a financial burden that eats away at your company’s profits and reputation if it contains conditions that you can’t uphold. By having a St. George real estate law attorney help negotiate your commercial lease, you’ll be able to feel confident that your interests are protected.