Tenants leasing commercial space always have some negotiating power beyond what price they are willing to pay per square foot. In a down market, tenant negotiating power may be increased. The main question to be asked is "Are you getting a fair deal?" Even if you think the answer is yes, it is strongly advisable to have an attorney review the commercial lease. What experienced attorneys often find among all the legalese are hidden costs and unreasonable risks, which the client should know about before they sign the lease.
Having an attorney negotiate your commercial lease will help you with understanding its contents. Often a company's most valuable asset is its lease (besides the people, of course). Some questions you should know the answer to when entering a commercial leasing include:
How is the commercial space measured? What are the common areas?
What are the maintenance obligations? HVAC responsibility?
What rent concessions are being given? Are there any work allowances?
What do the assignment and sublet clauses say? Do you want the owner to have a right to block the sale of your business?
What options do you have to renew and/or expand? A ROFO? A ROFR?
How is the liability set (is it personally guaranteed)? If it is personally guaranteed, then the guarantee should be limited as much as possible.
How are commercial leasing disputes to be resolved?
If you are not experienced with these questions, you may fall victim to some of these traps. Make sure you are prepared when entering a commercial lease as it will save you money down the road.
Kurzon LLP can help prospective tenants go through these and similar questions to help ensure they are getting the best commercial lease possible.
We also draft commercial leases for landlords and negotiate with tenants. There is no such thing as a "standard form commercial lease." Everything is negotiable and you see this in the riders to these "standard forms."
Please contact Jeff Kurzon if you would like a professional commercial lease attorney to review your commercial lease in NYC. Let us put our experience to work for you.