A lot of commercial leases in Del Mar can be long and intimidating, especially if it is your first time. But, you can get the most out of your lease by negotiating its terms. Keep in mind that landlords usually want you in their space as badly as you want to be in it. Thus, you don’t have to be fearful of the overwhelming lease document. Here are tips to help you better negotiate a commercial lease:
Identify the Term of the Lease
Typically, you can rent a Del Mar office space for lease for 5-20 years with extension options and escalations. To determine how long your lease term will be, consider many economic and personal factors. For instance, it is often best to negotiate a shorter lease term for a non-franchise business or a startup. In general, landlords want to sign a tenant for a long lease term to secure occupancy, but they may want to work with you to create a manageable lease.
Meanwhile, if you are contributing to the renovation of the space, you want a longer lease term to amortize the money you spent. Also, a lot of standard leases contain clauses that require any and all permanent fixtures to stay on the premises after the expiration of the lease. If you spend money and time on some affixed furniture, ceiling lights, and the like, consider negotiating this aspect of the lease.
Review the Lease
Keep in mind that a Del Mar commercial lease agreement is a contract that can have unexpected legal impacts on you, your family, and your business if you fail to review it carefully. In many instances, landlords provide spaces with their standard lease forms and tenants just sign a lease that ends up being the reasons for their business to fail.
Typically, bigger landlords have different standard lease forms that they use in various situations. These forms contain a fine print that is not clear and hard to understand. But, taking the time to read the lease in detail will help you better understand its substance. This helps you understand the position of the landlord in a lot of negotiable areas.
Research Comparable Rates
How much rent you will pay is a significant consideration in a commercial lease agreement. Make sure to research and determine the going costs in your area to negotiate a fair price. When negotiating renewal options, ensure to specify rent increases to avoid surprises later. Your landlord may increase the rent for every additional year. Also, negotiate the amount of the security deposit and its return’s condition.
Ask for Favorable Clauses
Ensure you ask for modifications in the lease that will bring you many benefits. For instance, consider a clause that lets you sublease the property when your business unexpectedly relocates or closes. Also, ask for a clause that restricts the landlord from renting out any other units on the premises to your competitor.
A co-tenancy clause will let you break the lease if a big anchor tenant leaves. Also, you can negotiate for the landlord to take responsibility for making improvements to the property before you move in.