The traditional retail model has undergone massive changes in the last few years here in California and across the country. With more people shopping online, shopping malls and other retail stores are helping the commercial real estate market plateau. Developers could find themselves in financial trouble if paying back their loans becomes problematic due to changes in how the economy works.
As mobile banking and automated teller machine use increase, diminished foot traffic in bank locations led to shuttered branches. Nine out of ten households now utilize online banking and four out of ten use mobile banking, eliminating the need to visit a branch for normal transactions.
No matter how much planning you do, something could go wrong. For this reason, part of your business planning involves purchasing insurance policies to cover different eventualities that could occur during the course of your business. As a commercial tenant, your Orange County landlord will more than likely expect you to include liability insurance in those policies.
Nearly every project, whether here in California or elsewhere, involves numerous moving parts. In order to protect yourself from any adverse events that could occur during a development project, you may want to consider several types of insurance. This may seem like an obvious choice, but what may not be as obvious to a new developer is what you need to properly insure your project and protect your interests.
We've written about common area maintenance in the past. And for good reason. Vague line items like "administrative fees" can be thousands of dollars, sometimes hundreds of thousands or more. That's one reason you audit past CAM charges, especially where you've taken over a business. In other situations involving CAM, the property owner's estimates are off - by huge margins - and the tenant is hit with a massive bill.
"You made your bed. Now lie in it!"
As a landlord, you have numerous options regarding the types of leases you may offer tenants. If you offer retail space in a California shopping center, you may want to consider the percentage rent commercial lease. This type of lease may be more landlord friendly than other options.