Are you ready to negotiate your commercial lease?

Commercial Real Estate Agent

Various types of leases exist - completely understanding the differences between NNN leases and a gross lease can be extremely important. NNN Leases - true passivity for the Investor will help to explain a portion of the NNN lease.  Once you understand the type of lease you are putting together then you must put together a few other pertinent details.

Prior to negotiating the terms of a lease, outline thoroughly provisions that would promote your business. Before entering into a binding contract, decide the term of the lease;

A short term lease yields flexibility and more leeway to change your demands after a given period. Though long term leases are less supple, they provide stability. The negotiating process will take seemingly perpetual give-and-take, but settling for wary provisions is foolish. While the list is boundless, beware of the following stipulations:

  • Assignment Clauses;
  • Personal Lease Guarantees;
  • CPI-Based Rent Increases;
  • Permitted Use Clause;
  • Limitation on Improvements; and
  • Relocation Clause

It is important to understand why these lease stipulations can be unfavorable depending on the verbiage used and how they are negotiated.

Although a lessee analyzes the provisions listed by the owner, he/she may want to insist on additional terms;

  • Exclusion Clauses;
  • Security Terms;
  • Space Boundaries;
  • Etc.

The very most important thing to remember when negotiating a lease - EVERYTHING IS NEGOTIABLE!  and maybe even more important - hire a professional, it costs you nothing to engage an agent as your tenant representative. 

Ryan Haddock

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