With a retail store, it is all about location. If you want your business to succeed, you need to ensure that you are renting a commercial building in the right location. When you find a retail store in an ideal location, you will want to negotiate a strong lease for the location. A commercial retail lease is more detailed than a home lease and requires more preparation.
Know What You Need
Before you start to work on a lease, you will want to know what you need. Sit down and figure out what your budget is and what you can afford to spend on the lease so that you will know what you can afford as you negotiate the price.
You will also want to know what your must-haves and nice-to-have terms are so that you know what your priorities are when you are going through the lease process. For example, maybe you value free parking, or maybe you want utilities included in the rent, or perhaps you want access to more storage space.
Work with an Agent
Setting up a commercial lease is more detailed than just renting an apartment for a year. Commercial leases have lots of layers of complexity and require negotiations, which is why you should work with a commercial real estate agent to help you find the property and then negotiate the lease for the property. A real estate agent may even be able to get you deals you wouldn't get otherwise, and they may bring clauses to your attention that you might have overlooked on the property.
Run Multiple Negotiations
Just because you are negotiating on a lease doesn't mean you are going to get the property. If you find more than one location that you feel is the right place, it is okay to negotiate on more than one lease at the same time. If one lease falls through, you will have the other one to rely on. You will be in a better negotiation position with both locations when you have your eye on more than one place.
Never Agree to the Base Rent
When it comes to the rent, the landlord will usually start with the highest possible amount that they think they can get for the property. That is not what they actually expect you to pay; the base rent allows your landlord to negotiate the rental rate. You should always bring in a counteroffer to the base rate and find an agreeable number for both parties.
You can also often get a lower rental rate by agreeing to a longer lease term. For many landlords, knowing that they will have a tenant for the long-term is worth it to drop the rent price to get you to agree to rent the location for the long term.
When it comes to negotiating the terms of a retail commercial real estate lease, you will need to know what you want out of the leasing process. You will want to work with a real estate agent to represent your interests and help you with the process. Never agree to the base rent, and remember that it is okay to run multiple negotiations at once.
Share3 June 2021
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