Before you start searching for a great warehouse space for rent for your company,you must to get informed about the commercial warehouse leasing procedure. Being ready will prevent you from making expeditious decisions and costly mistakes you will end up regretting later on. The following are some insider tips to help make an informed decision when renting a commercial space your company
Start the process of searching commercial space at least 6-12 months before your existing lease expires or until your perfect move-in-date. Finding the right space and negotiating the deal will require 1-2 months depending on the size space and current market conditions. In most cases the spaces you like will need some type of improvements that the time required will depend on the scope of work.
Thoroughly examine your business’s present and future needs. Consult with the different department heads for input as well as some key employees.
Get familiar with allthe commercial property terms and meanings. Various landlords state and quote things otherwise. If you’re in doubt about what they mean don’t be afraid to ask them to supply more info.
If you’re not knowledgeable about the commercial real estate leasing process or the present market conditions then consider engaging the help of a tenant representative. Their services don’t cost anything because landlords pay all of the rental commissions. The landlord agent will have an expert listing agent representing them so it would be a great idea for you to have one as well.
Physically see all of the properties that meet your requirements so you can make a brief list. Keep in mind that the designs can be reconfigured so don’t get stuck on that. Ask the landlord reps a great deal of questions about the ownership,property amenities,required lease term length,how much the landlord is prepared to give in tenant improvement allowances,etc..
Do not settle for the first commercial properties you believe is acceptable for your requirements: continue searching until you have at least 2 to three alternative options. These additional options will work to your advantage because you will know what to expect throughout the lease negotiations and you will gain more leverage with numerous landlords competing for your company. They also give you something to fall back to if the negotiations for your first choice go sideways.
Send out proposals to your top three to five options. These are not legally binding. You never want to take a landlord agent’s verbal note. Everything should be in writing.
To help you decide what property is most suitable for your company,prepare a spreadsheet to do an apples to apples comparison of each property. Some of the things you should consider include the size of this distance,the asking base rental rates,the necessary lease duration,and the incremental costs (taxes,insurance,maintenance,etc). It is also possible to take note about the pros and cons of each property. If you’re budget conscious then you can quickly narrow down the list by simply calculating the monthly base rents for each property then eliminating those which are way above your budget. The monthly base rent is calculated by multiplying the industrial space square feet by the asking base rate plus any operating expenditures then dividing by 12.
If some of the commercial buildings need tenant finish-outs then it’s crucial that you determine what changes you want on each and get construction bids. This way if the landlord is offering a tenant improvement allowance you will know how much out of pocket you will need to pay above and beyond what the landlord is prepared to give.
Carefully analyze and compare the terms of each proposal. Consider whether it is logical to go back to each landlord to negotiate additional concessions. Be sure you fully understand the total expenses you’re expected to cover. Do not get emotionally attached to a certain property until the negotiations are over. Emotional attachment might lead to you signing a contract your business can’t live up to.
After negotiations are finalized and you have made your selection now it’s time to have the landlord provide you the first draft of this commercial lease contract.
Now it’s time to review the commercial lease contract. It would be wise for you to hire an attorney to review the lease. If you have a tenant representative then they could review the lease with you as well. Industrial lease language could be negotiated. If you don’t like certain lease items or would like to propose new language now is the time to do so.
When the end of lease contract negotiations has finished the building owner will give you a draft of the lease to sign.
There are several more things to consider when leasing commercial real estate however these ideas will help get you going. If you’re a new company leasing commercial property for the first time or an existing company who has only rented 1 or 2 spaces then consider getting help from a tenant agent. Their services do not cost you anything and you will save a great deal of time and money.