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What to consider before you sign your office lease

You've found your ideal office space, and your Tenant Rep Broker has successfully negotiated lease terms, on what you believe to be the best interests for your business. But no matter how confident you feel that everything's been covered off, there are some final checks to do before you sign on the dotted line.

First and foremost, you need to run the lease past a Real Estate Lawyer to review from a legal perspective. They will advise you on the small print of the office lease to make sure you are 100 per cent clear what your tenant obligations are, and draw your attention to any onerous clauses.

To help simplify the office leasing process, here are some things to look out for in the small print of your office lease for you to discuss them with your Real Estate Lawyer:

Length of Lease
The length of lease that is right for your business will depend on many factors including the anticipated future growth and how long your business has been in operation. Ask your Tenant Rep Broker to advise you on the optimum lease length that suits your business. Check the small print about exiting the lease early (prior to expiry), as tenants often have to comply with all lease obligations before they can exercise the right to walk away early.

What's Included?
Check the lease carefully to find out exactly what's included in the rent. Unfortunately, not all leases will state explicitly what is included - so be sure to check. A gross lease is typically all-inclusive (with taxes, insurance and maintenance), but tenant utilities, for example, may or may not be included. Understanding the difference between triple net and gross net leases is important when comparing different properties so you can be sure you are comparing apples with apples.

Repairs
Your office lease should clearly state who is responsible for paying and carrying our repairs and maintenance of the space, as well as within the building and all the facilities included within the demise.

Build-Out Costs
Your new office space is likely to require modifications / build-out to enable your business to operate effectively. The office lease should clearly state whether the landlord or the tenant is responsible for paying for the build out. Some landlords give an 'allowance' for the build out, if not, then the costs will lie with the tenant and it's important to have these costs clearly listed in your Moving Office Budget.

Demised Premises & Purpose
Your commercial lease should clearly state the space that you will be leasing, also known as the 'demised premises'. It may sound obvious, but make sure the description matches the demised premises you are planning to rent. Also make sure that it clearly states that the space can be used for general office use and for no other use. If you need a professional and trustworthy Real Estate Lawyer to review the lease on your behalf, you can find one in our directory listings. Simply select your location to connect with Real Estate Lawyers that we recommend.

TOP TIP: Never sign any lease until you are 100 per cent satisfied that you understand what's involved and you have the financial resources in place to commit to the length of the lease.

 

Planning an office move? Go the office relocation planning resource center

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