Tips For Attaining The Very Best Deal When Hunting For Warehouse Space To Rent
Before you start searching for an excellent warehouse space for rent for your small company, you need to get informed about the commercial warehouse leasing process. Being ready will prevent you from making impulsive decisions and costly mistakes you will regret later on. Below are some insider suggestions to help make an informed choice when letting a commercial space your company
Initiate the process of locating commercial space at least 6-12 months before your existing lease expires or before your perfect move-in-date. Finding the perfect space and negotiating the deal will take 1-2 months depending upon the size space and current market conditions. In most cases the spaces you like will need some type of tenant improvements which the time needed will depend on the scope of work.
completely examine your company’s current and future needs. Consult with the different department heads for input in addition to some key employees.
Get acquainted with allthe commercial space terms and definitions. Various landlords say and quote things otherwise. If you are unsure about what they mean do not be afraid to ask them to get more info.
If you are not knowledgeable about the commercial real estate leasing process or the current market conditions then consider engaging the assistance of a tenant agent. Their services do not cost you anything since building owners compensate all of the leasing fees. The landlord rep will have an knowledgable listing agent advising them so it would be a good idea for you to have one also.
Physically visit all of the properties that meet your needs so you can make a short list. Bear in mind that the designs can be reconfigured so don’t get stuck on that. Ask the landlord representatives a lot of questions regarding who owns the property, property amenities, required lease term length, how much the landlord is prepared to give in tenant construction allowances, etc..
Don’t settle for the first commercial properties you believe is suitable for your needs: continue searching until you have at least 2 to three other options. These extra options will work to your benefit since you will know what to expect throughout the lease negotiations and you will gain more leverage with multiple building owners competing for your business. They also give you something to fall back to whether the negotiations to your first choice go silent.
Send out proposals to your top three to five options. These aren’t legally binding. You never want to take a landlord agent’s verbal word. Everything needs to be in writing.
To help you decide what property is best suited for your business, prepare a spreadsheet to do an apples to apples comparison of each property. Some of the things you should put into consideration include the dimensions of the distance, the inquiring base rental rates, the required lease term, and the incremental costs (taxes, insurance, maintenance, etc). You can also take note about the pros and cons of each property. If you are budget conscious then you can quickly narrow down the list by simply calculating the monthly base rents for each property then removing those that are way above your budget. The monthly base rent is calculated by multiplying the industrial space square feet by the asking base rate and any operating expenditures then dividing by 12.
If some of the commercial spaces need tenant improvements then it is crucial that you determine what changes you want on each and get construction bids. That way if the landlord is offering a tenant improvement allowance you will know just how much out of pocket you will have 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 return to each landlord to negotiate extra concessions. Be sure you completely understand the total expenses you are expected to cover. Don’t get emotionally attached to a certain property until the negotiations are over. Emotional attachment might result in you signing a contract your business cannot live up to.
After negotiations are finalized and you’ve made your selection now it is time to have the landlord offer you the first draft of the commercial rental contract.
Now it is time to reassess the commercial rental contract. It would be advisable for you to hire an attorney to review the lease. For those who have a tenant representative then they could review the lease with you as well. Industrial lease language could be negotiated. If you do not like certain lease items or would like to propose new language now is the time to do so.
Once the end of rental contract negotiations has ended the building owner will supply you a draft of the lease to review.
There are several more things to consider when renting commercial property however these ideas will help get you going. If you are a new business renting commercial space for the first time or an existing business who has only leased one or 2 spaces then consider getting help from a tenant rep. Their services do not cost you anything and you will save a lot of time and money.
