Commercial Lease Agreement Review in 2023: A Guide for Business Owners with Multiple Locations

If you’re a business owner with multiple locations, expanding your business in 2023 can be an exciting and profitable endeavor. However, negotiating a commercial lease agreement for additional space can be a daunting task, especially if you’re unfamiliar with the process. As a business owner with multiple locations, there are some unique challenges that may arise. Fortunately, there are steps you can take to ensure that you negotiate the best possible lease agreement for your business. In this blog post, we’ll cover the basics of commercial lease agreement review and provide tips for business owners seeking to negotiate a lease for additional space. Here are some key tips for reviewing a commercial lease agreement: Don’t wing it: Reading the entire commercial lease agreement before signing is key. It’s like flying a plane – you don’t want to skip the pre-flight checklist. Strategically Manage Rent and Fees: Owners of businesses with multiple locations can adopt a strategic approach to managing rent and fees. For instance, they can negotiate lower rates by leasing multiple spaces at once, thereby leveraging their bargaining power across locations. By doing so, owners can benefit from economies of scale, reducing costs across their portfolio of properties.  By managing rent and fees strategically, owners of multiple locations can maximize their resources and build a strong foundation for their business. Strive for Consistency: Negotiating a commercial lease agreement for additional space as a business owner with multiple locations can be a complex process. Owners must consider the unique challenges that arise from having multiple locations, such as differing lease terms and conflicts between location needs. To overcome these challenges, owners should ensure that the lease terms are consistent across all locations, to the extent possible. This can help to minimize confusion. Plan for Growth: Owners of businesses with multiple locations face unique challenges when it comes to expanding their business. To ensure that their lease agreements can accommodate future growth, owners must carefully review the terms of their lease agreements and negotiate clauses that allow for additional space or changes in location as needed. They must also be mindful of the varying expansion needs of each location and develop a strategy to address these needs effectively. This requires clear communication and coordination among multiple locations to ensure consistency across all lease terms and address any conflicts that may arise. By planning for growth in advance, owners can position themselves for long-term success and avoid costly and disruptive lease renegotiations down the line. Rent Increases: Additionally, owners of businesses with multiple locations should carefully review and negotiate any clauses related to rent increases, particularly for multiple locations with different lease terms or lease expiration dates, to ensure that rent increases are fair and consistent across all locations.  Cumulatively, annual rent increases can have a major impact on your bottom line. Benefits of Lease Abstracts: To reduce the administrative burden and confusion when a business owner has multiple commercial leases in place with different landlords, owners may want to consider having lease abstracts prepared. Lease abstracts provide a summary of the most important terms of a lease agreement, such as rent, lease length, renewal options, and maintenance responsibilities, in a concise and easy-to-read format. This can help owners quickly compare and understand the terms of each lease agreement, as well as identify any potential issues or red flags that may need to be addressed. This can also help reduce administrative burdens and increase transparency, allowing owners to allocate resources more effectively. Seek professional advice: If you’re unsure about any aspect of the lease agreement, consider seeking professional advice from a lawyer or real estate agent. They can help you understand the terms of the agreement and negotiate on your behalf if necessary. By following these tips, you can ensure that you’re negotiating the best possible commercial lease agreement for your business. Remember, it’s important to review the agreement thoroughly and seek professional advice if necessary. With the right preparation, you can expand your business with confidence and success.