Leasing Commercial Space

Leasing Commercial Space

Leasing commercial office space is one of the largest expenses incurred by new and expanding businesses, so it is important to do your due diligence. Here are some tips for negotiating a commercial lease for your small business.

Lease Agreement

Lease term and rent are your first negotiation points. You will want to factor in rent increases over the term and renewal options so you are not charged with an unexpected rent increase without warning.

As well as working with a qualified Coldwell Banker Commercial Real Estate Broker, it is also important to consult a knowledgeable real estate lawyer; they can often recommend the right choice for you and protect your interests as you negotiate your lease.


In addition to your monthly lease payment, find out what expenses you may incur beyond rent.

Commercial real estate landlords often incorporate extra expenses into the lease such as maintenance fees, upkeep for shared facilities (Common Area Maintenance or CAM), etc. Other expenses to consider are utilities. These charges are usually the responsibility of the tenant, so find out how these are measured. Are they individually metered or apportioned by square footage? Ask to see these “hidden fees” and policies as well as examples of costs that are typically incurred by tenants.

Maintenance and Repair

While residential leasing often places the burden of maintenance and upkeep on the shoulders of the landlord, commercial leases are different. Commercial leases vary regarding maintenance and repair – some stipulate that the tenant is responsible for all property upkeep and repairs while others specify that the tenant is responsible for systems like air conditioning, plumbing, etc.

Read the Lease

Be sure to read over your lease in detail and hire an attorney who specializes in commercial real estate to walk you through the clauses and fine print.

Protect Your Business

To protect your investment and long-term business interests, it is worth investigating and negotiating some potential add-on clauses to your lease. These might include:

  • Sublease – This builds in some flexibility, allowing you to sublet your space to another business.
  • Exclusivity clause – Prevents the landlord from leasing other spaces on the property to a direct competitor of yours.
  • Co-tenancy – If the property’s anchor tenant closes business, a co-tenancy agreement can protect you from a potential loss of customers, allowing you to break the lease if the landlord does not replace the anchor tenant in a specified time period.

What if You Default?

Should you default on your lease payments, there are steps you can take during the lease negotiation process to protect yourself. Find out what the lease agreement states. Will you be locked out immediately? Will the landlord initiate eviction proceedings? Can you negotiate more time? Could you pay only the current month’s rent instead of the remaining amount owed on the lease?

Source: US Small Business Administration


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Tenant Representation

Coldwell Banker Commercial® (CBC®) professionals specialize in tenant representation and will develop customized real estate solutions for tenants. CBC professionals clearly understand today’s corporate business climate and work to trim expenses and drive value to your bottom line.  Whether you need to lease or sublease office, industrial or retail space, a CBC professional can develop a customized solution that meets your real estate needs and expertly provide innovative solutions to multi-market or local requirements.  With access to colleagues in over 200 CBC companies across the globe, and completing over 11,000 tenant representation transactions in the past two years, CBC professionals have a proven track record in reducing occupancy cost and increasing profitability for tenants. CBC professionals come to their clients as trusted advisors and all transactions are completed with the client’s needs first.CBC professionals can assist you with any of these services:

  • Strategic Planning
  • Relocation Services
  • Transaction Management & Reporting
  • Lease/Own/Sale Leaseback Analysis
  • Negotiations
  • Lease Analysis
  • Market Surveys and Analysis
  • Demographic / Drive-time Studies
  • Space Planning
Visit our Commercial Real Estate Questionnaire today to help us help you with your
Commercial Real Estate Leasing needs be they Office, Retail or Industrial Properties
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