How to Rent Business Space -- the Top Ten Things to Consider

Moving your small business into a new space can be exciting, but it pays to think about what you and your business need. Before you rent a new business space, there are some important matters to think about.

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Before You Start Looking for Commercial Space

Moving involves cost and risk. Commercial property is expensive, and you'll have to negotiate new lease terms and set up new space. Your customers already know where you are. The first question to ask is whether you can improve your current location. If renovation is an option, and there is nothing wrong with your location a remodel wouldn't fix, spend the money on a building facelift.

If fixing up your current location won't work and you must move, take time to consider what you need. Are you moving for more office space, a better location, or a better lease agreement? This article gives you some important considerations to keep in mind when heading out to look at a new business location.

Business Needs

Business owners often have an idea of what they want but don't know what they need. You may have an image of more space but haven't stopped to consider how many square feet you need. Take time to make three lists: things you need, things you want, and things you must have. This helps determine what you're looking for. For instance, you want a storefront with a south-facing exposure, you need retail space with a loading dock, and you must have air conditioning.

Financial Needs

Your business needs should dovetail with your financial abilities. You would like the maximum square footage you can afford, but don't forget that your base rent is only the starting point. Depending on the type of lease, you must add insurance, maintenance, or property tax to that amount. You must pay a security deposit upfront and at least two months' rent when you sign your lease.

Location

Location matters in leasing commercial property as much as in residential leasing. You're probably considering moving for location reasons. Location factors for your move should include your target market, access for customers and suppliers, competition, and suitability for the area. Even if you can afford it, opening a surf shop in downtown Des Moines may not be the best location for your business.

Size

Commercial real estate rents by the square foot. However, zoning laws regulate occupancy and building use. The type of business you operate will dictate how much space you need and what you can use it for. Think about this carefully before beginning your search. Remember that office buildings often list the square footage of the offices but tack on common areas like hallways, elevators, or conference rooms to the monthly rent. Determine your space needs before you commit to a property.

Growth

You hope your business will grow. That means your space requirements will grow, too. Renters are always caught in the uncertainty between a space that is big enough now but will be too small before the lease is up. Retail stores are vulnerable to this issue since their customer base can grow rapidly. Look for property in shopping centers where expansion is possible without impacting your lease.

Neighborhood

In the business world, you can pick your neighbors and often should. Having the right business neighbors is important for the long-term success of your company. Customer flow is still important, even though many people now shop online. The other businesses in the area should be similar to yours, encouraging customers to visit.

Access

Access means how your customers get to your location. It includes whether they can easily reach you from the highway and if there is available parking. Many viable retail businesses have failed because there was no nearby street parking. You should also consider accessibility for disabled customers. Although new buildings must be ADA-compliant, older buildings may have received waivers and will need upgrades when a new tenant moves in.

Appearance

You will have the least control over the external appearance of your building. In strip malls and shopping complexes, the property owner controls the appearance. In other areas, zoning codes may regulate the height and color of the building. You should look for a building that meets your requirements and is easy to maintain. The appearance should be low on your list of requirements.

Safety

Safety means security for your customers and employees. Check the crime reports in your proposed business area. Walk around the area and look for more subtle signs of trouble, like gang graffiti, bars on back windows, and padlocked doors. Safety also means emergency preparedness. Be sure you have adequate business and property insurance and coverage for any local hazards, such as hurricanes in Florida and earthquakes in Los Angeles. Know your local OSHA laws and follow them.

Lease Terms

Know your lease terms. Commercial lease agreements are always negotiable, but once you've signed, you're in for the duration. If you're unsure about anything in the agreement, have a business law attorney review the contract for you and explain what you're agreeing to. Most property owners do not want short-term leases, but startups should hesitate to commit to long-term ones. Your attorney can help with negotiations to get you the best terms on a lease.

When To Seek Legal Help

As a small business owner, you must juggle many tasks at once. Deciphering business laws shouldn't be one of them. Let a business and commercial law attorney help rent your next business space by putting their expertise to work for you.