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Should I sign a standard lease?

Regardless of what kind of business you run, in almost all cases you will eventually end up seeking out some form of commercial lease. In fact, for most companies of just about any size, going through process of either re-negotiating the lease to keep their space or searching for a new space altogether is something that happens about every three-to-five years. If you are just getting started with your commercial lease search, or if it's been a while since you've had to deal with the prospect, you may be tempted to sign a "standard" lease, without any revision or negotiation. In almost every case, this is not the most prudent possible choice.

As the tenant, you are not the party who is likely to be the one to most benefit from the terms of a "standard" lease. Even if the lease seems pretty fair, any lease that is drafted by a landlord is ultimately going to have the landlord's interests most protected. This is not necessarily bad thing, it's just the nature of business. It is also not a bad thing to take that lease and negotiate the terms to better address your specific needs and concerns.

When you are presented with a standard lease, by definition it has not been created to meet the needs and concerns of your business. Assuming that nothing goes wrong for either party throughout the term of the lease, it might not matter — but when something does go wrong, it pays to have carefully thought through the ramifications of any agreement. If, for instance, you sign an agreement to move from your current location to a new location on a certain date, and the space is not ready for your move, what then? Hopefully your current space will be lenient, but what if they have another tenant who is expecting to move in also? There are literally hundreds of reasons to negotiate and revise any lease agreement before you sign it.

Part of what makes negotiating a lease so difficult is the intimidating complexity of the document. Even if you want to negotiate the best deal for your business, how do you know what that is? If you need any additional help negotiating the perfect lease for your situation, the guidance of an experienced commercial real estate attorney can help ensure you stay on the right track.

Source: The Center for Commercial Real Estate, "How to negotiate a lease," accessed Oct. 11, 2016

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