You’ve done your research into the competition. You’ve checked out the demographics of the area where you would like to locate your business. Your business plan is ready. You have your banker’s backing. You’re ready to grab a space and sign that lease, right? Wrong!

  I would recommend that you engage a competent commercial agent to assist you in your search to find the right space. As I mentioned in a previous blog, there are many factors that go into finding the right space for your business. The area’s market conditions should be a very important factor in making your decision. Who else is going to know those conditions but your local commercial agent?

  You may run into lease terms that are totally unfamiliar to you. Do you know the difference between a gross lease and a triple net (NNN) lease? How about usable vs. rentable space?

  A Letter of Intent (LOI) is a very important tool to tell a prospective landlord what you want as it pertains to leasing his space. The LOI will outline such things as the length of the lease, the specific rental amount, pass-through costs, and incremental increases in the base rent over the life of the lease. Your agent can help you write a good LOI by asking you the right questions.

  A Request For Proposal (RFP) is a tool for you to solicit competitive bids from several landlords for the type of space you want or need. With an RFP, you determine basic requirements and get the landlords to give you their best offer to meet your requirements.

  If a landlord offers you a “standard” lease, you can bet that all the terms in the lease favor the landlord. You’ll need your own attorney to review any lease you intend to sign. Not just any attorney, but a local real estate attorney who is familiar with the local laws as they pertain to real estate.

  Stay tuned for more hints and tips in future blogs.