Dear Property Manager,
My partner and I are about to embark on a huge—and hopefully successful adventure as we take the “plunge” and start our own consulting business. We are looking at an office space in the Carolina area, either North or South Carolina in the Fort Mill, or Indian Land areas.
Being brand new in this process, we need to know-- what we need to know-- before we sign that commercial property lease!
Any guidelines you have you be much appreciated.
Tony L., Charlotte, NC
As I am sure you have noticed, renting office space in this area can be expensive, and quite complicated. That said there are also some great deals and wild differences in price from one place to another—and once you find the right place, then you get to start the lease negotiation process.
Since this is your first time renting a commercial space, there are a few things you should know before you sign anything. First, there are no standard lease agreements, and some include a lot of details, and others do not. No matter what property or leasing company you ultimately work with, you should have your contract reviewed.
Secondly, your lease is a legal and binding contract—one which you should not enter into unless you intend to fulfill your responsibilities. So before you sign on the dotted line, ask yourself (and your broker and landlord) these questions:
· How long do I plan to stay? Will you be there 1 year or 5? The terms will vary depending on length.
· Can I get out of the lease? What are the penalties for breaking the lease if the business needs to close or relocate before the term is up
· What are your certifications? What recognized real estate associations does your broker have to distinguish them from the others in their field.
· What experience do you have in similar transactions? Commercial real estate is very specialized, and most brokers specialize on one or two property types, and certain property sizes. Choose a broker who has experience in the type of property, size and location you are looking at.
· Who are the current tenants? Are the tenants in the building compatible businesses? If you own a dry cleaning business, you may not want to be in the same building as another dry cleaner.
· What about a property manager? A manager probably won't be on site at a small building, but if a manager or maintenance person is not on the premises business hours, make sure you know who will handle emergencies and requests.
· What kind of build-outs and amenities are provided? Make sure you know if the landlord will handle and approve build-outs, and what extra amenities are available with the lease.
· Will you be allowed to sublease? If you have extra space, or need to vacate before your terms are up, some landlords will allow you to sub-let the apartment.
· What are the lease terms? The monthly rent is the most important term, however, you also need to know if rent may go up during your term, and if you're required to pay charges for maintenance, taxes or other costs.
Kuester Property Management