Laying Into Your Commercial Landlord: The Questions You Should Ask

To lease or buy your commercial space, that is the business question. And, as much as we try to reach an answer, there doesn’t seem to be one. No matter what way you look at it, either option brings benefits from a business and finance point of view. So, which should you choose?

In a lot of ways, this depends on how established your company is. If you’ve got a good foot in the door and a stable profit, there’s no reason you can’t jump straight in and buy. But, if you’re still building a reputation, it might be best to rent office space which suits your needs. This then frees up money for expanding and growing what you’re trying to do. What’s more, it’ll allow you to get an office space at a much earlier stage.

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But, to assume this is the best financial option without question would be a mistake. Much like with residential rentals, there are questions you should always ask before signing on that dotted line. After all, this is a place which should bring you money, not lose it. Yet, if you don’t do your research, the latter could be true. To make sure that doesn’t happen, consider these four questions you should always ask first.

How much will your rent rise?

Asking about potential rises in rent is essential. The fact is that you’re committing to a set amount of money. That doesn’t mean you could afford the rent if it increased down the line. Of course, there's no avoiding increases thanks to inflation. The chances are this will happen at least once a year. But, getting a good idea of how much that increase is likely to be is your best bet at surviving the blow. Some landlords, for instance, cap rises like these at 1%. If that’s the case, it’s unlikely an increase will leave you struggling. But, landlords on the other end of this could sting you with a 15% increase or more. If that happens, you would have no choice but to relocate. And, relocations are never good news for budding businesses. So, don’t be shy. Make sure that you and your landlord are on the same page when it comes to the amount you’ll pay in the future. It may even be worth getting a written agreement if there are any caps in place. While there’s no telling what the future might bring, this will put you in the best position to weather the storm.

Are there limitations on business hours?

A lot of the time, you’ll be renting a unit within an office building. As such, many of the questions you ask will relate to this rather than your unit itself. While your landlord can’t change the regulations of that building, this should show whether this is the spot for you. One of the worst things to look out for is a cap on business operations. In some areas, for instance, businesses can only operate between the hours of 9-5. In certain buildings, even working overtime isn’t an option. Given how much money that stands to lose you, this should be a definite no-go. So, make sure to get the details about this before signing up. It may be that there are limitations but they still fit within your working day. That’s fine. But, if you have any suspicion your profits would suffer from this, it would be best to walk away. Bear in mind, too, that a five o’clock cut off, though not uncommon, would alienate you from after work customers. If that forms a significant portion of your daily business, look elsewhere.

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Are there decor limitations?

When we move into residential rentals, the decor is on most of our minds. And, the same should apply to your commercial space. You need to know that you’re free to advertise and decorate as you need. After all, this space needs to wow your customers. What’s more, tailoring your decor ensures you can boost office productivity no end. You’ll want to make your office homely so that your staff feel comfortably. So, from these early stages, you need to ask your landlord about the rules here. In most cases, those offering office rentals are pretty lenient about what you do inside the unit. They understand the need to tweak and change, and they should be accommodating. If not, don’t commit. Never underestimate how crucial it is to get your office space right. Make sure, too, to ask about any building regulations here. In some cases, it may be that the complex your unit is in calls for no outside advertising. It may even be that logos displayed outside have to adhere to set color schemes. Either way, this spells big trouble for your business. How can customers find you if you can’t fly your logo loud and proud? This should be a definite no-deal situation.

Can you expand if you need to?

It’s also worth noting if you can expand if you need to. The amount to which this applies will vary depending on where your office is. If it’s up high in an office block, you likely already know the answer here. But, if the unit in question is in a position where you could expand, you need to ask about this. As we’ve already stated, relocating could mean trouble. As such, you need to know that you can stay in this space for a long time to come. And, the reassurance of room for growth is all part of that. Though you may assume this would be an instant no from any landlord, you’d be surprised. This is a common occurrence in commercial properties, and most landlords are accommodating. Often, you may find that they merely stipulate which contractors you need to use. In which case, you need to decide whether the investment is worthwhile for you. But, one thing’s sure; if there’s no chance of growth, you might be best to take your search somewhere else.