The following is an excerpt from Jamie Moorhead's new book, Tenant Leasing 101, now available in paperback and Kindle formats on Amazon here:
Once you and your broker sign the letter of intent, the landlord’s attorney will send you a draft lease within a week or two. The complexity of the lease depends on the type of property. Generally speaking, retail leases are the most complex, with office leases being a bit more straightforward and warehouse leases being the most straightforward. Irrespective of the type of lease, they all seem to be getting longer over the years, particularly after the economic downturn of 2008.
When landlord sends you the lease, it easily could be 50+ pages, especially with exhibits. For a person not in the real estate business, the lease can be a bit daunting. So, what do you do? Here’s a brief list of action items:
Review Business Terms. The tenant should review the lease to confirm that the business terms reflect the agreement with landlord. The business person will have the best knowledge regarding both the business deal and what is acceptable to the company. While the broker and lawyer will review these terms as well, the business owner is the only one who will be responsible to satisfy the terms, so it is worth the time to review.
Hire a Lawyer to Review. Unless you are a lawyer or have an excellent understanding of the legal components to a lease, it is worth your time and money to hire a lawyer. A lawyer that focuses on leasing, particularly tenant leasing, will be able to help you negotiate the best deal and will help you navigate the subtle landmines in leases. Do not hesitate to negotiate the fee for your lease to have some scope of the overall cost.
Have Broker Review. Your broker is earning a hefty commission to get your lease done. As part of that fee, they should be taking an active...
For more, please visit Tenant Leasing 101 on Amazon here.