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The Office Lease Signing

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 After you and your office tenant rep have negotiated a lease for your office space that protects the interest of your business and is agreeable to the property owner, it is finally time to sit down and sign the legal document, a binding office space lease that allows you and your team to occupy the chosen space. You should have your tenant rep there to cover any last minute questions you might have.

Having a real estate profession in the person of your selected office tenant rep present may seem redundant since you have sought counsel and advice repeated during negotiations from your tenant rep. Yet, verify that the changes you have requested to the office space lease have been worded correctly in the final document can be tricky for those with less experience. A tenant rep hasthe experience necessary to be sure the wording does not turn a change made to favor your interests into a clause that could trip you up and actually cost you money. Remember, your goal is obtain the best possible office space at the least cost with right to require or have performed the tenant improvements agreed upon and avoid passing rising or extra costs on to you. Another point your tenant rep will re-check will ensure that the rent increases over time do not become excessive.

Do not allow yourself to be rushed into signing the final office space lease without thoroughly comparing the notes you made of requested changes to the final document. Plan at least one to one and one-half hours for the lease signing to allow the thorough review. Whether on purpose or inadvertently, it is possible an important change could have been left out or misworded, changing the intent of the verbiage completely. If any part of the lease does not meet with the changes negotiated, stop the signing process and require an edited lease be delivered before signing.

You should also require a property checklist which itemizes the fixtures provided in the office space. For example, if the landlord is providing a refrigerator or table and chair in the break area, these items would be listed, inspected and any damages, however slight, should be noted on the checklist. Also, all walls, flooring, ceiling, doors, service outlets, and environment climate control units should be inspected during lease signing and their exact condition noted. Any damage, even small dings or excessive wear and tear, should be noted so that when you eventually relocate and release the office space to the property owner you will not be changed for these damages. Your tenant rep will help you go through the property and look for items necessary for your checklist. Many landlords use a standard checklist so be sure to note any items on the list that do not apply to the office space you are leasing.

You will need to bring payment to the lease signing table for the security deposit, any key deposits and rental payments, or whatever other payment arrangement is outlined in the lease. Customarily initial payments include first month of rent but sometimes rent for first and last month is required. Sometimes if significant tenant improvements must be completed before occupancy (be sure this is noted in the lease along with completion dates), or the occupancy date has been established for sometime in the near future, only payment of the security deposit may be required at lease signing with rental payment due upon taking occupancy of the office space. Payments can usually be in the form of a business check, money order, or certified cashiers check and in some cases payment can be made with a personal check, debit or credit card. Most landlords no longer accept cash due to the inherent danger of carrying significant amounts of cash and the possible accounting confusion if business cash becomes mixed with personal cash. Be sure to understand in advance what methods of payment are acceptable to your landlord and arrive prepared with the correct payment in one of the acceptable forms.

Once you and landlord have both signed the lease for your new commercial office space it is too late for further negotiations. You will be given keys to the property and it becomes your responsibility. You can then pat yourself and your real estate tenant rep for a negotiating job well done. 

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By: James Osgood

Lease Negotiations , Office Leasing Tips , Office Rental , Office Space

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