November 18, 2022
Those who are in the market to rent a commercial office space are often searching for a property that includes a wide set of criteria. The type of office space you rent may vary based on the business you intend to operate out of that space. However, when you do find that perfect commercial space, you must know how to negotiate a commercial office lease that works for you and your business.
The most common types of commercial lease agreements include:
Gross Lease. A gross lease is a type of commercial lease agreement in which you pay a monthly rent which also includes your share of utilities, operating expenses and real estate taxes for the building. With gross lease agreements your lease payments will typically remain consistent.
Modified Gross Lease. With a modified gross commercial lease agreement, you pay a monthly base rent, utilities and usually your share of increases to operating expenses and real estate taxes.
Net Lease / Triple Net Lease. A net lease agreement or triple net lease agreement is a commercial lease agreement in which you pay the monthly base rent, utilities and your share of all expenses and real estate taxes.
Comparing commercial lease agreements between various properties can be a lot more challenging than comparing residential lease agreements. This is largely because many factors can differ between each commercial office space. Generally speaking, most commercial office leases have a minimum term of one year, but many require tenants to commit to at least three to five years. You need to be aware of any minimum terms before you finalize your decision.
Most commercial property owners understand that their tenants will want to customize their space to some extent. However, each property owner is going to have their own requirements and limitations in place, so it’s important to discuss your ideas with the property owner during negotiations. If significant modifications will need to be made to the space to make it functional for your business, you will want to talk with the property owner about who will be responsible for the expenses associated with making those changes. It is necessary to have these conversations before signing your lease agreement to prevent any misunderstandings after you have already committed to the lease.
If you are planning on entering into a commercial lease agreement, the best thing you can do is to rely on the help of a trusted expert. It can be overwhelming and intimidating to go into commercial lease negotiations without someone who can advocate for you and help you make sense of the terms. Without the help of a trusted advisor, you may make a costly mistake and agree to something that is not beneficial for your business. Before you begin seeing commercial properties and considering lease agreements, you should partner with a commercial realty group that can represent your best interests.
At Rakow Commercial Realty Group, we are the leading experts in commercial property leases and how to go about negotiating them in your favor. Our team will work with you to help you find the perfect commercial office space to rent, and we will actively negotiate to get you the most favorable terms. For more information about commercial office leasing, contact Rakow Commercial Realty Group.
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