STOP SIGNING LONG TERM LEASES
NO CONTRACT, NO DEPOSIT @LionSHare Cowork
A commercial lease for office or retail space is a serious commitment for your business. They are typically long-term contracts lasting at least three to five years, the rent is often your second-biggest monthly expense after payroll, and the rights and limitations in your lease agreement have major effects on your ability to expand, contract and relocate your business. Companies large and small can make major mistakes when planning for new space and negotiating a lease.
There is no such thing as a “standard commercial lease.” Landlords - the building owners and their property managers - do not have your best interests in mind when they draft a lease, and business real estate deals have none of the legal consumer protections of apartment leases. The financial terms and legal provisions of most commercial leases are specialized and hard to understand, and most business people lack the background to effectively review and negotiate a lease agreement.
Unlike a standard apartment lease, a commercial landlord can demand more than 2 months' rent in cash. It can be whatever amount the landlord thinks it needs based on the creditworthiness of your business. If you are a brand new business without an operating history this will be a big issue for the landlord.
You cannot easily break or change a commercial lease. It is a legally binding contract, and a good deal of money is usually at stake.
Do you know what a percentage, single, double or triple net lease is? Is your lease a modified or full service gross lease? Who pays for the utilities, internet, maintenance of the HVAC, janitorial; What happens if a toilet is clogged?
Ultimately, you need to think of your company's future as you consider whether to enter into a long or short-term lease agreement or a coworking space. If you're not sure whether or not you want to remain in the area, suspect that a period of growth is on the horizon or are otherwise uncertain of the future, a coworking space like LionShare will likely be the best choice for your company's needs.