The Lease Term
There are many things to think about when you own a business. Most businesses, at some time in the life of the business, will rent space. A commercial lease can be a lengthy and complicated document with a significant financial obligation. It is critical for you to understand the terms of the lease. Due to the complexity of the document and the financial significance, it is valuable to hire an attorney to represent you and your business, to review the lease and explain the terms and help you negotiate the best possible deal for your business before you sign the lease.
A key term to watch for in a long-term lease is the length of the lease term can impact the business in many ways. As a new business, it may be difficult to commit to a long-term lease because it is difficult to know whether the business will be successful. The longer you commit yourself, the more you limit your business when it outgrows space or if you need to change locations for any reason.
In the unfortunate situation where the business is not able to exceed, tenant is committed to the term of the lease regardless of whether the business is operating. In this situation, the tenant will have to continue to pay rent until the landlord is able to rent the space to another tenant.
For an established business, the tenant may want a long lease with several options to renew. There are many costs involved in setting up a business such as tenant improvements, business stationery, bank accounts and forms, specially purchased equipment and fixtures in addition to having a presence at a particular location, walk-in business and customer goodwill. This type of tenant may have a significant incentive to remain in the same location for an extended period of time.
Hire an Attorney to Help Navigate the Process
There are many terms in a lease that can have significant financial impact on your business. It is highly recommended that you retain a skilled real estate attorney to help guide you and assist with understanding and negotiation of a commercial lease to protect your business and attempt to avoid future disputes.
If you have leasing questions or for more information, please contact Lisa Wills of the Law Offices of Lisa D. Wills is a skilled real estate law attorney in Pleasanton, California. To speak with Lisa Wills, call (925) 463-9000 or send an email.