Leasing Commercial Office Space

Leasing commercial office space is one of the largest expenses you acquire when you are opening a new business or you're expanding your business. So it is important to do your homework.

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Basically, a lease is much like a partnership agreement in that it sets out the restrictions of a business relationship. When everything goes as planned, most any lease will serve the parties well but the true test occurs when there are obstacles in the partnership. If the lease has not been carefully drafted, an obstacle can become a major problem for either of the parties.

Tenants often don’t read the entire "Standard Form Lease" or sometimes there is something they done understand what it means and if not appropriately brought to the landlords attention before the lease is signed , may not serve their interests when issues arise. On the other hand, a sophisticated tenant will often request changes to the lease that, if not fully understood, can cause unforeseen difficulties for the landlord as well.

Here are a few tips to help you when signing a commercial lease:

1. First off, You always want to read the lease to its entirety, make sure you understand each term, word, clause or anything written. If you do not understand a term in the lease ask for clarification from a lawyer or knowledgeable disinterested party. Relying on the landlord or a listing agent to explain their lease is not a great idea because they could mislead you intentionally, or may not understand the lease themselves.



2. How is your monthly rent calculated? The most basic equation for calculating a lease payment takes the number of square feet times the cost per square foot, then amortizes that over a 12 month span. It's important that you understand exactly what you are paying for and what expenses the landlord will cover. Are you responsible for any costs other than the rent? Are you responsible for paying for your own utilities and garbage pickup? It’s good to understand that ahead of time.



3. If there is any repairs that need to be done before you can move in, have the landlord do repairs before you sign a lease. If any work is to be done after you take occupancy be sure this is detailed in the lease including work completion times. You do not want to have your business shut down for weeks at a time because of ongoing work. Remember that any changes or improvements you make on a commercial property, unless you own that property, becomes an improvement for the land owner. This is an area to surely negotiate with the landlord.



4. The lease terms. Consider the growth that you expect to see in your company in the coming years. A short-term lease may be ideal if the growth is hard to forecast, but the downside to short-term leases is that lease rates tend to change. Sometimes long-term lease agreements have the option of expansion so that growth can be accommodated. Long-term leases are ideal when real estate rental prices are low and are forecasted to rise. Short-term leases tend to lead to more frequent moving, which presents costs of time and money.

In order to play it safe, budget a six-month timeline from day one until to move-in. This will allow your company enough time to plan, find space, negotiate the deal, install IT infrastructure, make minor cosmetic alterations and move in.

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How do you start the idea process? "MY OWN BUSINESS"

Many people believe starting a business is a mysterious process. They know they want to start a business, but they don't know the first steps to take. . . . . . Understand that business startup isn't rocket science. It isn't easy to begin a business, but it's not as complicated or as scary as many people think, either. It's a step-by-step, common-sense procedure.

First step: Figure out what you want to do. Once you have the idea, talk to people to find out what they think. Ask "Would you buy and/or use this, and how much would you pay?" Determining what you want to do is only the first step. You've still got a lot of homework to do, a lot of research in front of you. One of the most common warnings you'll hear is about the risk. Everyone will tell you it's risky to start your own business. Sure, starting a business is risky, but what in life isn't? One of the best ways to determine whether your idea will succeed in your community is to talk to people you know. If it's a business idea, talk to co-workers and colleagues. Run personal ideas by your family or neighbors. Don't be afraid of people stealing your idea. Just discuss the general concept; you don't need to spill all the details.

Hopefully by now, the process of determining what business is right for you has at least been somewhat demystified. Understand that many people around you won't encourage you (some will even discourage you) to pursue your dream. Some will tell you they have your best interests at heart; they just want you to see the reality of the situation. Some will envy your courage; others will resent you for having the guts to actually do something. You can't allow these kinds of people to talk you out of starting your business or influence you to stop your journey before it even begins.

What will you lose if things don't work out? Don't risk what you can't afford. Don't risk your home, your family or your health. Ask yourself "If this doesn't work, will I be worse off than I am now?" If all you have to lose is some time, energy and money, then the risk is likely worth it. Van Nuys Offices Los Angeles, Ca Commerical Rentals

Money to Start a Small Business

Finding money to start a small business takes a lot of work. To start with you will need a good business plan and several leads for small business loans and grants. There are a number of available programs to assist startups, micro businesses, and underserved or disadvantaged groups. Start your capital search with a good business plan that shows investors and lenders your company's potential.

Follow that up with a thorough knowledge of the resources available and a determination to make your business a reality, and you should be on your way to uncovering a source that fits your new business's cash needs. There are several sources to consider when looking for financing. Don’t make the mistake of thinking that the only place you can find the money you need is through the bank or finance company. Explore all of your options before making a decision.

The first place to look for financing is right at home and personal savings and assets are the easiest source of capital. If you have money set aside, you use it instead of borrowing or rounding up investors.

Next, turn to members of your family or close friends who have faith in you and want to see you succeed. Borrowing from a friend or relative is generally the most readily available source, especially when the capital requirement is smaller. Relatives and people you know need fewer assurances and are more open to your ideas than professional investors.

Angels are private investors interested in making more on their capital than they can make through traditional markets such as mutual funds or publicly traded stocks. These “angels” can be your accountant, attorney, doctors or other individuals who seek out new businesses to invest in return for equity ownership. Usually providing additional capital in the range of $25,000 to $500,000, expect angel investors to demand high returns for their investments.

Either way, there are risks and gains; what you take will depend on your tolerance for risk and your personal objectives. Van Nuys Offices