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by Alexander Gordon
You have
started a new business, or your business has expanded. You need
office space, and buying property is not an option. What do you do?
Go for leased office space. Before you sign an office lease, you
need to keep certain things in mind.
1) Location: The choice of the location depends on your business. Do
you, for example, work in a field related to law? Then maybe you
should consider being near a courthouse or a library. If you need to
interact with your clients a lot in person, then you should lease
office space near them.
2) Lease Term: How long do you want to lease the office for? Most
office spaces need to be leased for at least three years. Before you
sign the office lease, compare at least four properties.
3) Business Expansion: If your business grows, you may need extra
space. Does the property have extra space? You may need to discuss
this with the landlord before leasing.
4) Liability: Some landlords may need a personal guarantee from your
side. If you are not comfortable with that, find a landlord who does
not need it. Try to get the landlord to limit the liability to the
lease rent.
5) Subletting: Can you sublet your office if your business does not
work out? This will also help you avoid the lease penalty for
pulling out early.
6) Rent Cap: Set a maximum value to the rent, so it cannot be
increased arbitrarily.
7) Renovations: Do the property need renovations before you move in?
Who will bear the expenses of the renovations? These questions must
be discussed in detail, before you sign the office lease.
8) Damages: How much is your liability? If the building suffers
damage during your term, how much should you have to pay?
9) Utilities: How much of the electricity bill is included in the
rent? Will you be allowed to set the thermostat according to your
needs? How frequent is the garbage removal service? Get answers to
all these questions before signing the lease. Check all the electric
appliances before you sign the lease agreement.
Renter’s Insurance: If your assets suffer damage inside the leased
office, the landlord may not pay the costs. Going for a renter’s
insurance is a good option. Your property will be covered under the
terms of the insurance from theft, damage or natural disasters.
Real Estate Consultant: While signing an office lease agreement, it
is advisable to have a real estate consultant go over the lease
agreement and negotiate on your behalf.
Go through the lease agreement carefully, before you sign. Once the
agreement is signed, do not look back. Consider the above points
before signing. If you are not sure about the terms, consult a real
estate advisor or an attorney experienced in property matters.
Alexander Gordon is a writer for
http://www.smallbusinessconsulting.com
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