The world of commercial real estate features distinct challenges and opportunities for both startup entrepreneurs and established business actors. The realm is vibrant, complex and constantly evolving.
And it unquestionably favors creative and proactive participants focused on profit and long-term success. Such individuals are constantly at work across Atlanta’s vast and diverse commercial sphere, with their focus spanning broad-based business concerns and considerations.
Like property acquisition, for example. And regulatory compliance. And myriad other matters ranging from contractual negotiation, drafting and enforcement to land/use zoning, employee relations, financing and more.
For many business principals, one of those “and more” concerns centrally spotlights commercial leases. That is logically a key focus for legions of company owners, given their expansionary goals, the need for flexibility and the savings typically secured via a lease as compared to outright property purchase.
Some immediate realities surrounding commercial leases
The first point that might prominently surface for many individuals perusing commercial lease particulars is this: They are patently unlike their residential counterparts. A commercial lease differs in a number of fundamental ways from a residential lease, including these:
- Readily negotiable terms make for comparative complexity
- Judicial assumption regarding parties’ business sophistication leads to fewer automatic legal protections
- Material case-to-case variance in term duration
- Ample opportunity for proven legal input to foster optimal contractual outcomes for a client
Key focal points common to many commercial leases
Although every executed commercial lease is a contractual instrument with negotiated terms and conditions that stand out as unique from other contracts, most agreements have some overlap. Matters that are commonly addressed in a commercial lease include these:
- Rent amount and stated clarification concerning factors that influence it (e.g., square footage and party responsible for paying insurance, utilities, taxes and other exactions)
- Formula used to determine amount and frequency of any rent adjustment
- Lease length (For example, is a lease a longer-term contract or a short-term agreement with a renewal option?)
- Modifications and improvements (Who will pay, and what is permitted?)
- Signage (stated allowances/parameters concerning public advertising on the rented space)
- Exclusivity (In a nutshell, can the landlord rent adjacent space to a business rival?)
- Tenant’s assignment/sublet rights during lease term, if any
Most of the above bulleted points are negotiable in a commercial lease. Proven representation from an experienced real estate legal team can help a business client pursue optimal results concerning them.
