Sep 14, 2021
How To Find & Rent Warehouse Property
Before you begin searching for a good warehouse space for rent for your business,you will need to get informed about the commercial property leasing procedure. Being prepared will keep you from making expeditious decisions and costly mistakes thatyou will come to regret later on. The following are some insider tips to help make an informed decision when letting a commercial property your company
Start the process of hunting commercial space at least 6-12 months before your current lease expires or until your ideal move-in-date. Finding the correct space and negotiating the deal will require 1-2 months depending upon the size space and current market conditions. Typically the spaces you like will need some type of improvements which the time needed will depend on the scope of work.
Thoroughly examine your company’s present and future needs. Consult with the various department heads for input as well as some key employees.
Get familiar with allthe commercial space terms and meanings. Different landlords state and quote things otherwise. If you’re in doubt about what they mean don’t be afraid to ask them to get more info.
If you’re not familiar with the commercial leasing process or the present market conditions then consider engaging the assistance of a tenant rep. Their services don’t cost you anything because landlords compensate all of the rental fees. The landlord representative will have an experienced listing agent helping them so it would be a good idea for you to have one also.
Personally visit all of the properties that meet your requirements so thatyou can make a brief list. Bear in mind that the designs can be reconfigured so don’t get stuck on that. Ask the landlord agents a great deal of questions regarding the ownership,property amenities,required lease duration,how much the landlord is prepared to give in tenant improvement allowances,etc..
Do not settle for the first commercial space you think is acceptable for your requirements: continue searching until you have at least two to 3 other choices. These extra options will work to your advantage because you will know what to expect during the lease negotiations and you’ll gain more leverage with numerous landlords competing for your business. They also give you something to fall back to if the discussions for your first choice fall through.
Send out proposals to your top three to five choices. These are not legally binding. You never want to have a landlord agent’s verbal word. 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 dimensions of the space,the inquiring foundation rental rates,the required lease term,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 removing those which are way over your budget. The monthly base rent is calculated by multiplying the commercial space square feet by the asking base rate plus any operating expenses then dividing by 12.
If any of the commercial spaces need reconfiguring then it’s important that you figure out what improvements 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’ll have to pay over and beyond what the landlord is prepared to give.
Carefully analyze and compare the terms of each proposal. Consider whether it makes sense to return to each landlord to negotiate additional concessions. Make certain you completely understand the total expenses you’re expected to cover. Do not get emotionally attached to a certain property until the discussions are over. Emotional attachment might result in you signing a contract thatyour business can’t live up to.
After discussions are finalized and you’ve made your selection now it is time to have the landlord offer you the first draft of the commercial lease contract.
Now it is time to reassess the commercial lease contract. It would be advisable for you to hire an attorney to review the lease. If you have a tenant agent 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 want to propose new language now is the time to do so.
Once the end of lease contract negotiations has finished the landlord will give you a copy of the lease to review.
There are several more things to think about when renting commercial space however these ideas will help get you started. If you’re a new company renting commercial property for the first time or an current company who has only leased 1 or two spaces then consider getting help from a tenant representative. Their services do not cost you anything and you’ll save a great deal of time and money.
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