If you are a small business owner looking to negotiate an office rental space for the first time, there are some key terms that are typically included in a lease that you should be familiar with as you begin the process. Here are a few more critical terms you can expect to come across:
- Security Deposit – and the conditions for the return of this payment.
- Improvements – know whether there will be fixtures added to the space, or any modifications or improvements (these are called build outs when a landlord is finishing a new space to a tenant’s specifications). Clarify who will pay for these, and who owns them after the lease term is over (typically, the landlord will own them).
- Maintenance and Repair – whether it is your responsibility or your landlord’s to maintain and repair the space, including heating and air conditioning systems.
- Subleasing – whether you can sublease or assign your space to another tenant.
- Renewal and Expansion – whether there is an option to renew your lease for another term or expand into surrounding spaces.
- Termination – determines if and how the lease may be ended; this clause includes any agreements on penalties for termination, notice requirements, and any alternatives to taking a dispute to court.
Doing some homework before you start looking for a space can help you become a savvier lease negotiator!