Whether you’re planning to launch a new business and looking for suitable premises, or you’re already an established business and would like to rent larger office space, understanding the terms commonly used by commercial real estate agents can help ensure you make the right choice. the right decision. The language agents speak can leave potential renters confused; the terms explained below should help you deepen your knowledge on this topic.
Gross lease is a contract in which the lessor covers all costs and expenses associated with the property. This may include out-of-pocket related to taxes, maintenance, and utility bills.
A triple net lease, also known as an NNN lease, is a contract in which the lessee agrees to be responsible for a fixed rental charge, as well as specific expenses related to overseeing the space, such as maintenance costs.
Certain properties may also be taken on a percentage lease basis. This is a contract in which costs are based on a percentage of the volume of sales made by a business on the property.
When reviewing commercial property listings, you may see that available space is described as usable and profitable. Usable area relates to the part of the office that can be occupied from wall to wall, this differs slightly from leasable area which also includes shared areas of a building, including lobbies and restrooms.
If there are multiple businesses operating in the same building, there may be a common area maintenance fee in addition to the regular rent. It is important to factor this cost into the calculations when comparing multiple properties.
If you want a building to undergo internal renovations before you start operating from the address, you must prepare a letter of employment with the owner. It is a document in which the landlord and the tenant state in writing what changes have been agreed to be made inside the premises.
When planning to rent office property, you should take your time to explore as many different options as possible. Only by fully understanding the terminology used by real estate agents will you be able to identify the commercial real estate that best suits your needs and budget. Do not sign a rental agreement unless you are 100 percent sure that the premises are perfect for your needs.