commercial lease default letter template

During negotiations, if you need to increase landlord contributions, try increasing the length of your lease term.ĭoing your homework and making sure you include as many points of negotiation as possible will help you avoid unpleasant surprises when it is time to review and sign your lease. A lease term of only five years may not allow the landlord to make back his investment.

Tenant improvements can cost the landlord hundreds of thousands of dollars. Addressing this in a letter of intent will quickly show you whether the location is feasible or you need to move on. You can negotiate how much the landlord will pay and whether the landlord pays contractors directly, gives you an upfront allowance, or offers a rent abatement. You may need extra restrooms, updated lighting, and fixed shelving for your merchandise. If you already lease commercial space, you can use your current lease to guide you and negotiate changes where your current lease is inadequate or where property differences exist.įor example, if you are leasing commercial retail space, you can negotiate the landlord’s contributions to the necessary improvements needed to operate your business. Visit the property and compare its characteristics with your business needs. What kind of annual revenue does your business generate? What is your annual rent budget? Does your budget allow for maintenance expenses, or will you need the landlord to cover these? You also need to consider your business finances.

How many square feet do you need? How many parking spaces do you need? What modifications or accommodations would your business need in order to operate? You will need a solid understanding of your business needs in relation to the property. You need to know all the details about the property so you know what modifications and services to request in your negotiations.įor example, if it is a shared office building, who pays for the utilities? Who maintains the property? Is parking available nearby? What potential is there for branding, signage, and expansion? If you are trying to lease commercial retail space, is there enough parking for your customers? During your pre-offer commercial real estate due diligence period, you will need to gather as much information about the property as possible.

Commercial lease default letter template