Factors to Consider When Drawing Up a Commercial Lease
Any entrepreneur looking to rent a commercial property should work with a lawyer to draw up and review contracts. Legal language can be challenging to understand, and leases involve a lot of fine print. It’s easy for busy business owners to overlook crucial details, making it vital to hire a lawyer, such as Mr. Tarunjeet Gujral of Mississauga, for commercial lease agreements.
Of course, business owners need to pay close attention to who pays what when drawing up a commercial lease. This includes rent, property taxes, utilities, and insurance. These factors could have a significant impact on the company’s expenses. There are many other factors entrepreneurs should also pay attention to as well before signing a commercial lease. Let’s take a look.
Who Pays for Improvements
There’s a good chance that the business owner leasing a property will make substantial and expensive modifications to the property. In some cases, the landlord may make the improvements to the business to entice them to rent. Or the landlord might agree to pay for a portion of the upgrades and remodeling.
Further, if a business is going to pay for the improvements, they will want to make sure that, at the very least, there is a clause for the landlord to provide reimbursement should they break the lease. Speaking of which…
When and Who Can Terminate the Lease?
The terms for breaking or terminating a lease should be spelled out very clearly. Issues over reimbursements, security deposits, etc., should be defined and understood by all. The business will want to protect their interests and ensure that the landlord can’t arbitrarily harm them by breaking the lease or threatening to break it.
Consider a Competitor Clause
Let’s say you open a pizza shop in a strip mall near Mississauga. Quite likely, you won’t want another pizza shop to set up shop right next door. After all, the competing business could steal your customers. If you’re paying for expensive advertising to draw people to your location, but the competition then draws away clients, you’re essentially providing them with free marketing.
In some cases, landlords will agree not to lease space to a direct competitor. A competitor clause should be agreed upon beforehand and can provide a considerable amount of protection.
Commercial Real Estate Legal Service Mississauga
There are many more factors to consider. Contact Gujral Law Professional Corporation, serving residents living in and near Mississauga, to learn more about commercial leases and how a lawyer can help. Call (647) 957-8077 to schedule an appointment.Back to Real Estate Page