Considerations When Negotiating a Commercial Lease
“Considerations When Negotiating a Commercial Lease”
Commercial leases are required for the vast majority of business owners for commercial/industrial business premises (not residential). A lease gives the tenant rights to the use and occupation of the premises for a period of time in return for rent and meeting other conditions and obligations. Issues to consider:
- Base Rent, does it include or exclude outgoings and GST?
- Outgoings, payment of all or a proportion of the building insurance, rates, land tax and other charges.
- Term of the lease
- Option periods
- Use of the premises
- Increases in Rent and/or Rent review periods.
- Security Bond
- Insurance requirements
- Alterations to premises
- Breach of lease terms
- Repairs and maintenance
- Termination of lease terms
- Trading hours
- Costs for preparation of the lease
After you have found a qualified tenant, or tenants, you need to check their personal or company reference, and credit checks.
To avoid any problems arising in the future, it is important that you obtain legal advice prior to entering into a formal Commercial Lease Agreement so that you clearly understand your lease obligations and/or your solicitor can seek improved terms.
Getting a Property Rental Price