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What goes into the monthy payment for your retail space?

Starting a new business here in Orange County, or anywhere in the state, requires you to look at numerous financial considerations. One of the monetary issues that you need to include in your planning involves the amount of rent you will pay for your retail space. This number ultimately involves more than just a price per square foot.

However, the price per square foot is a good place to start. After that, your prospective landlord will more than likely pass on a portion of its costs to your business. You may end up paying part of the property taxes and/or part of the maintenance costs for the common areas such as the parking lot, among other things. You may also find your company paying a portion of the insurance premium for the space your business occupies.

That portion of the insurance premium is on top of the insurance premium you pay on your coverage. Many Orange County landlords use the triple net lease system described above. Simply calculating a cost per square foot could cost you dearly when it comes time to make your first rental payment. Instead, you may want to go over any rental documents given to you by the landlord with a fine tooth comb.

Understanding the true cost of your retail space may require some help. If it turns out that the lease provisions are not in your favor, it may be possible to negotiate a better deal. A commercial real estate attorney can be invaluable in this endeavor.

Source: thebalance.com, "What It Costs to Rent a Retail Space", Matthew Hudson, Accessed on Dec. 2, 2017

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