When you start looking at acquiring business space in Southern California and surrounding areas, you may soon come to realize just how stressful the process can be. While there is no shortage of Los Angeles County commercial real estate, there can be a shortage of suitable real estate for your needs.
It can be easy to become overwhelmed by the entire process and make mistakes while signing your lease. To reduce the risk of this happening, it might help to be aware of some of the most common mistakes tenants make when signing a commercial lease agreement.
Not Hiring Expert Lease Advisors
You may not think you need to hire expert lease advisors like Jeff Tabor Group, since everything you need to know is laid out in the online commercial listing. While it’s helpful to know the number of parking spaces you have, the floorplan, and your monthly costs, there can be a lot more to consider.
Commercial leases can ultimately be more complex than residential ones. Expert lease advisors can offer no-obligation lease reviews that may end up saving you money. Their job is to go through the lease agreement with a fine-tooth comb to find hidden money-saving opportunities.
They can also pick up on any part of the lease that may disadvantage you in the future while negotiating for more benefits than what is currently on offer. As straightforward as your lease agreement may seem, having advisors on corporate real estate providing their industry experience can be a weight off your mind.
Only Focusing On Price
While affordable monthly lease payments are crucial for any business to turn a profit, it’s paramount to strike a balance between affordability and building suitability.
A commercial lease might be within your budget, but it may also not be in an area that suits your client base or have the features you require for your staff and business operations. Set a budget to narrow down your options, but don’t let it be the deciding factor when it comes down to choosing the best commercial structure for your needs.
Not Reading Through Your Lease Agreement Properly
Lease documents can be dozens of pages long, which means you may only skim through before signing. As overwhelming as a pages-long agreement can be, it’s crucial to read every small detail and make sure you understand it.
Los Angeles County real estate professionals can walk you through your lease agreement before you sign to make sure you understand everything within it. This can include the type of lease term you’re signing up for, likely rent increases that increase your overall monthly costs, and obligations for repairs and maintenance.
While you’re reading, be on the lookout for clauses such as a pre-existing condition clause. This means that upon leaving the building in the future, you must return it to its original layout. You may need to remove flooring, walls, and paint, among other costly renovations.
These changes can blow out your budget and cause significant hardship for your business. Commercial lease advisors can also explain terminology surrounding rate fluctuations. Electricity and water costs may be manageable early in your lease, but fluctuations can see them quickly become unaffordable towards the end.
Failing to Consider Your Business’s Future Needs
The way your business operates today may not be how it works five years, or even one year, down the track. Think about expected growth that could be in your future or even downsizing. A commercial structure may suit your immediate needs, but consider whether it can cater for more or fewer staff and stock in the future.
When you start your hunt for new commercial premises, either look for a building that is adaptable for your ever-changing needs or see if you can adjust your lease to allow rights to extra space within the overall structure if required in the future.
However, if neither of these options is suitable for your situation, your chosen commercial lease expert may be of assistance. They can negotiate lease terms on your behalf, which means they may be able to insert an early termination clause into the agreement.
If there comes a time when your space no longer suits your needs, you may be able to end your lease prematurely to avoid missing out on a more suitable location.
Not Asking Questions
If you have never been involved in the property leasing process before, it’s unlikely that you will understand everything about it. You may have a fair idea of what you’re looking for in a property, but not the steps to take to get it or any implications resulting from particular lease clauses.
When you meet with a lease advisor or even the property owner or manager, go armed with a list of questions. The more questions you ask, the more informed you can be about what you are signing and what your future in this new premises can look like.
Rushing the Process
Residential tenancy agreements are typically quite straightforward and prompt. Within days, you can do your due diligence, find a suitable home in the hot housing market, and fill out a short application form. You may hear back from your prospective landlord within a week or two.
However, finding the perfect commercial property and signing on the dotted line can be a much longer process. Therefore, make sure you’ve allowed yourself plenty of time. If you rush the process, you may end up choosing a property that doesn’t suit your needs purely because you’ve run out of time to find something more fitting.
Not Rushing Enough
When you find what you believe is the best commercial property for your needs, it’s time to act. Get the experts involved in the contract process as soon as possible, and iron out those kinks relating to contractual changes and negotiations.
Waiting too long to take action can see you miss out on what may have been the perfect property for your business now and during expansion in the future. One of the most memorable moments in your business life can be signing a lease for a new building. It might be the start of your business journey or a pivotal turning point for growth.
However, failure to do your due diligence can also see it etched in your memory as one of the most stressful situations you’ve ever encountered. Be aware of these mistakes above to put you in the best position possible to sign a lease agreement that suits your needs perfectly.pixabay.com