Before You Sign A Commercial Lease

Have a commercial lease reviewed before signing if it runs longer than a year, includes a personal guarantee, or shifts repair costs to you. Those three terms decide most of the money a small business will spend on its space.

Personal Guarantees

Many landlords ask owners to guarantee the lease personally. That means your own savings can be at risk if the business closes. Guarantees can often be limited by time or amount.

Repairs And Operating Costs

Some leases make the tenant pay for roofs, heating systems and parking lots. Read the definitions of common area costs carefully and ask for a yearly cap.

1. Ask for the full lease and every exhibit before negotiating.
2. List who pays for each repair category.
3. Request a cap on shared operating costs.
4. Negotiate the guarantee amount and length.
5. Confirm renewal options in writing.

Renewal And Exit

An option to renew protects the location you build. An early exit clause, even with a fee, protects you if the business needs to move.

The rent is the number everyone negotiates. The repair clause is the number that surprises people two years later.

Marcus Hale, Associate

General information for Georgia readers, not legal advice for your situation.