Commercial Leasing Tips and Techniques: The importance of time, timelines, and timing.

AuthorGrandfield, Jeff
PositionREAL ESTATE

As we emphasize in our new book, Negotiating Commercial Leases & Renewals FOR DUMMIES, the leasing process is not a simple task. Considering the number of steps involved and potential hurdles, properly planning and allowing ample time can save commercial tenants aggravation and--more importantly--money.

One common mistake commercial tenants can make is agreeing to terms too quickly with the real estate agent. We routinely hear from frustrated tenants who signed too hastily and realize after the fact that they may have made a mistake. While they do good work, agents work for the commercial landlord (rather than the tenant) and they will often push a prospective tenant to lease a unit that may not be the best choice (it may be too large or too expensive). The long-term success of the commercial tenant is of little importance to the agent--the agent's motivation will often be a promised commission from the landlord (and that commission will typically increase when the tenant leases more commercial space and leases for more years). It's not uncommon for potential tenants to receive a call from the agent saying that someone else is looking at the space that they looked at last week, pressuring business owners to "hurry up and sign." Don't let things like that sway you: go your own speed and get it done right.

As a business owner, you will want to devote your time to doing what you enjoy and what is best for your business. Smart entrepreneurs often realize that they cannot accomplish everything that needs to be done, so they hire outside professionals (lawyers, accountants) to help them. Considering the amount of work involved with your own commercial lease, it can be worthwhile to use a professional lease consultant to ensure that you get a better--and fairer--lease deal with the landlord. For the best results, everything that needs to be done before signing a lease can easily take from twenty to forty hours... will you have this kind of time to spare?

Start Early, Check Your Work

Moving from time to timelines, scour all documents for deadlines and note these conspicuously. It may be possible to adjust these deadlines depending on the circumstances. You may find that some steps (getting financing in order or having a contractor inspect the commercial space) are beyond your control and you will need more time to get everything in order. While you could keep extending your condition periods by several days with your landlord, it is often better to...

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