To rent premises for your business, you will need to sign a commercial lease agreement. As with all contracts, taking time to review it and ensure you understand every detail is crucial.
If you miss something, you could find it harms the chance your business succeeds. What is more, as you are tied into the agreement, the landlord may refuse to let you out early. So you could be left with premises you do not want but cannot afford to go.
Here are some things to watch out for.
Are there any restrictions on what you can do with the building?
Sometimes in business, you need to evolve and change course. For instance, many restaurants needed to embrace delivery when clients were unable or less keen to visit in person.
Let’s say you start a cafe. A few months into your contract, one of your regulars tells you it would make an excellent venue for open mic nights. You agree and would welcome the chance to stay open later to help pay the rent. If the landlord put a clause saying you could only remain open until 8 pm, could not sell alcohol or play loud music, you will lose the opportunity.
How long can you stay?
For some types of company moving may be less detrimental. Yet, remaining in one place is vital for something like a cafe. Check what right the contract gives the landlord to raise the rent. If you do well, the landlord might see an opportunity for someone willing to pay more to profit from the excellent reputation you brought to the place.
What does the price not cover?
Not all landlords spell out what you will need to pay on top of the rent. It is best to get everything clear in writing before signing.
Commercial lease contracts can be complex, so if you are unsure, it is always wise to get help from someone who understands them.