PROPERTY NEWS - "Signing a lease, whether long or short term, need not be a daunting task when a little effort beforehand will ensure a successful outcome," says Leon Breytenbach, National Manager of the Rawson Property Group's commercial division. He points out a number of things to keep in mind when one is considering signing a lease contract.
Allow yourself the time to consider all aspects and implications of the lease. By entering into a lease contract without fully examining it, you could overlook minor, possibly even major inclusions or omissions. Do not make your decision from a position of desperation; refuse to be hurried into a decision until you are satisfied that it is right for your business and that it contains all the necessary clauses.
You will have frequent dealings with your landlord during the term of your lease, so it would be helpful to know a little more about them. Inasmuch as you will have to provide references to the landlord, it will benefit you to find out from the previous tenant whether the landlord is fair and reasonable in his dealings with his tenants and whether he is willing to address any problems which may arise. Ask how the building is financed, whether the landlord's portfolio includes other properties and if he has any partners, so as to determine the financial health of the entity to which you will pay rent. You could find yourself in a quandary if the landlord does not have the financial backing to properly manage the property or its financing obligations.
You will find it far easier to communicate with the landlord if you know him in person and not just as a phone or e-mail contact. Maintain a polite, professional relationship with him at all times in order to create the best atmosphere for a successful rental negotiation. Remember, the way you conduct yourself during a property visit or via telephone conversations with the landlord is important, as it will reflect on you as a tenant. Be direct and honest in any negotiation with him, never employ strong-arm tactics or misrepresentation as this would create tension or distrust, even causing you to be rejected as a tenant. Mutual trust is a prerequisite when entering into a contract, so being open and discussing your queries will help to lay the foundations for a successful working relationship.
Know what is included
Some commercial properties include parking and utilities in the rental contract while others exclude them. This can seriously impact on your budget, causing an affordable property to become too pricey. Ascertain which repairs or maintenance will be for your cost and what the landlord will cover. Confirm this with the landlord before signing the lease so as to be fully aware of how these costs will affect your budget.
Your business will have certain specific locational requirements, for example, you may need increased foot traffic, a larger parking area or greater visibility from the road. If your employees or clients depend on public transport, your premises will need to be near accessible transport routes. You should also consider whether the premises will allow for growth when your business expands, as having to relocate to a larger premises within a short time is an expensive and costly exercise.
Once the landlord has offered you the option to rent the premises, be sure to document any pre-existing damage or deterioration before signing the lease. This would include anything the landlord did not agree to repair after your initial inspection, such as stained or torn carpeting, broken blinds or damaged tiles. Stipulate any such damage in the lease agreement as pre-existing. It is advisable to take photographs of any pre-existing damage or deterioration at an in-going inspection, in case a dispute arises at the end of the lease.
Before committing your signature to the contract, be sure that your lease agreement includes all the points you have discussed with the landlord regarding any improvements that have been guaranteed, as well as any pre-existing conditions or revisions to policies which may be set forth in the standard lease agreement. Ask for clarification on any terms you may not fully understand or about which you feel uncomfortable. Discuss the contract thoroughly with the landlord to ensure that you have a complete understanding of every part of the contract.
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