Negotiate retail lease to get the best deal possible.
Whether you're searching for the perfect space for your new business or want to negotiate a new lease for an existing business, knowing what's going on in your local real estate market is key to locking in a budget-friendly lease. Compare multiple spaces and leasing terms to determine the best space for your needs and budget. Consider square footage, utility and property taxes as well as length of the lease. Hire a tenant broker to help during the negotiation process.
Instructions
1. Research retail spaces in your area. Compare square footage, overall condition, price per square foot, lease terms, cost to upgrade the space to suit your needs and utility costs.
Leases that include utility, maintenance costs and property taxes in the monthly rent are called gross leases. Leases that do not include these costs are called triple net leases. You will be responsible for additional costs not covered in the lease when signing a triple net lease.
2. Hire a tenant broker to help during the negotiating process. A licensed tenant broker is a real estate professional who can give you advice and guidance when you're looking for a retail space to lease. Contact your local small business administration office or chamber of commerce for a list of licensed tenant brokers.
3. Estimate how much it will cost to update a retail space before signing a lease. Ask the landlord to pay for some or all of the improvements.
Depending on the number of retail spaces available, you may be able to ask for a reduction in the monthly rent if the landlord is unwilling to pay for renovations beyond new paint and carpeting.
4. Review lease terms. Short-term leases usually last six months to a year and are best for startup businesses or businesses that do not require much space. Negotiate for renewal of your lease at least three months in advance to ensure you get the best deal. Typically, your rent will increase each year. Long-term leases for two years or more may reduce the overall cost of the lease.
Consider your options before signing a new lease. Research other spaces to see if you can rent a similar space for less.
5. Calculate the cost of moving from one retail space to the next. Also, calculate the amount the landlord will spend in marketing the space and making renovations to suit a new lessee. Use this information when negotiating a new lease to get a good deal.
Tags: retail space, tenant broker, before signing, before signing lease, best deal, broker help