Entries Tagged as 'Commercial Real Estate'
It's crucial to understand from the get-go that, practically and legally speaking, there are oceans of differences between commercial leases and residential leases. Commercial leases are not subject to most consumer protection laws that govern residential leases - for example, there are no caps on deposits or rules protecting a tenant's privacy. Keep in mind that besides the amount of the rent, other less conspicuous items spelled out in the lease may be just as crucial to your business's success. For instance, if you expect your shoe repair business to depend largely on walk-in customers, be sure that your lease establishes your right to put up a sign that's visible from the street. And if you are counting on being the only sandwich shop inside a new commercial complex, make sure your lease prevents the landlord from leasing to a competitor.
The following checklist includes many items that are often addressed in commercial leases. Pay special attention to a few of the terms, including:
- rent, including allowable increases and method of computation
- security deposit and conditions for return
- length of lease - also called the lease term
- whether the rent you pay covers utilities, taxes and maintenance - called a gross lease; or whether you will be charged for these items separately - called a net or, if the tenant must cover three additional costs, a triple net lease
- whether there's an option to renew the lease
- if and how the lease may be terminated, including notice requirements
- what space is being rented, including common areas such as hallways, rest rooms and elevators
- specifications for signs, including where they may be placed
- whether there will be improvements, modifications or fixtures - often called buildouts - added to the space, who will pay for them and who will own them after the lease ends
- who will maintain the premises
- whether the lease may be assigned or sublet to another party
- whether disputes must be mediated or arbitrated as an alternative to court
Source: Inc Magazine
Commercial Real Estate , Lease Negotiations , Office Leasing Tips , Office Rental , Office Space , Office Space Negotiations , Tenant Representation
Although this article is a few years old, it still stands the test of time. While this is good information, there is no substitute to assistance from a good tenant representative. That's what we do every day. To top it off, there is no cost to you for the services of your own representative. Landlords invariably have a listing agent under contract. The tenant representative represents you, but shares in the listing agents fee. It's win-win for you.
Find a Tenant Representative to find the right space ant the right price without the hassle. Avoid costly mistakes and get the best deal possible.
According to a recent article in the North Bay Business Journal, now is the time to act to take advantage of the bottom of the market:
"The title of the recent Sonoma State University economic outlook conference “The Time is Now” couldn't have more meaning than it does with the current office real estate market. We are at the bottom of the market, and now is the time to take advantage of the current opportunities before it’s too late."
I wish it were true, but as far as I can tell we have a ways to go before the actual bottom is reached in the North Bay or anywhere else. Now, that does not mean that now is not a good time to negotiate a great office deal. Landlords are hungry and hurting and some fabulous lease of purchase deals are available to those willing to dive in. Until the unemploymet rate starts to drop, the bottom is still in the future, probably within a year or maybe even two.
Get help finding a great office deal
Buying Office Space , Commercial Real Estate , Office Building Sales , Office Relocation , Office Space , Office Space Negotiations , Office Vacancy Rate , San Francisco Office Space
Feb 23, 2010 - CRE News
Fundamentals for small-capitalization properties have continued to deteriorate, according to Boxwood Means Inc., with key metrics such as rents and tenant demand weakening last month.
National rents were down across the board in January when compared to a year ago. The declines range from 3.34% to $18.94/sf for medical-office buildings, to 8.23% to $7.17/sf for industrial properties. Office properties in general saw a 4.04% decline in rents to $17.57/sf, while retail properties have seen a 6.31% drop to $17.55/sf.
When compared to a month earlier, rent declines ranged from 0.2% for medical offices to 0.74% for industrial.
Boxwood Means is a Stamford, CT, research firm that focuses on small-cap properties, which it defines as those with less than 50,000 square feet. It compiles property-level operating and sales data through a partnership with LoopNet Inc.
It also compiles Days on Market, a calculation of how long it takes to rent vacant space that it uses as a gauge for tenant demand. It said the metric is at its highest level in nine months, meaning space is languishing on the market.
Despite the bad news in the data, Boxwood Means noted that declines in rents and demand are no longer as steep as they were in previous months. But it cautioned that fundamentals would continue to weaken until the national jobs picture improved and consumer confidence rose. Today, the Conference Board reported that consumer confidence had fallen sharply this month.
Buying Office Space , Commercial Real Estate , Office Building Sales , Office Rental , Office Space , Office Space Negotiations
Washington Post February 19, 2010: Unlike residential mortgages, which often can be paid over 30 years, commercial real estate mortgages typically must be paid off or refinanced within five years. Commercial properties mortgaged in 2005, 2006 and 2007, at the height of the boom, are reaching their maturity date. "Do the math on this," Warren said. "This is a significant problem."
Nationwide, at least $1.4 trillion in commercial real estate debt is expected to roll over during the next three years. Warren said that half of commercial real estate mortgages will be underwater by the beginning of 2011. A fifth of residential mortgages are underwater now, she said.
Unlike residential mortgages, which often can be paid over 30 years, commercial real estate mortgages typically must be paid off or refinanced within five years. Commercial properties mortgaged in 2005, 2006 and 2007, at the height of the boom, are reaching their maturity date. "Do the math on this," Warren said. "This is a significant problem."
Buying Office Space , Commercial Real Estate , Office Building Sales , Office Space , Office Space Negotiations
WASHINGTON (AP) -- The outlook for jobs became a bit less bleak with January's unexpected decline in the unemployment rate, which fell to 9.7 percent from 10 percent as more people said they had jobs.
Still, Friday's unemployment report showed just how deep the job crisis remains. The government now estimates 8.4 million jobs vanished in the Great Recession, and economists think the nation would be lucky to get back 1.5 million of them this year. And they say it will take at least three to four years for the job market to return to anything like normal. <End>
Not particurally good news for the office market. Employment is directly related to occupancy. If the econimists are correct, it means office space occupancy will take three to four years to return to normal vacancy rates in the 8% - 12% range.
Commercial Real Estate , Office Space , Office Space Negotiations , Office Vacancy Rate