Leasing A Building In Fort Lauderdale Or South Florida? 6 Things Startups Need To Know
It is an exciting time when your startup begins to grow, and there is a good chance that you’ll be considering leasing a new office or commercial building at some point.
Below is a brief list of concerns that startups should evaluate before choosing a building. It’s always helpful to consult with an experienced commercial real estate attorney in Fort Lauderdale for any of these steps, especially those that are related to lease negotiations or due diligence.
Review your business plan
It’s important to consider how incorporating an office space or upgraded building will fit into your current business plan. Ask yourself if you are ready for the commitment and overhead of a commercial lease, since they are often 3 to 5+ years in length.
Get your financial documents in order
You’ll need to provide several financial documents to your potential landlord, even though they may be limited as a startup. Get whatever documents you have together so that you’re ready to demonstrate current cash flow and income.
Have a security deposit ready
Be sure to have a security deposit saved up for your commercial lease, as you’ll always be required to provide one. The amount of the deposit is often negotiable; some landlords may try to request unreasonably high deposits which your attorney can assist you with reducing.
Get advice on the personal guarantee
Landlords requesting personal guarantees are common in the post-recession era, even though the market has long recovered. This can put the founders’ personal assets at a liability if your company fails and the lease agreement has to be terminated.
However, your attorney can assist you with possibly removing this requirement altogether which is ideal, or minimizing your liability if they are adamant.
Have a termination option
Although it can be challenging to negotiate, it may be important for your business to have a termination clause in your lease agreement. This would allow you to pay a penalty if you choose to break the lease before the end of its duration.
As a startup it can be challenging to know how the next few years will go, even if you’ve showed many positive signs of growth recently, therefore this option is worth discussing with your attorney.
Hire an attorney for lease negotiations
As a newer business owner, you may not be familiar with some of the common problems that occu with commercial real estate leases in your industry.
That’s why it’s even more important for you to hire a Fort Lauderdale commercial real estate attorney for advice.
For any questions about leasing commercial buildings in Fort Lauderdale or South Florida as a startup, contact Schecter Law today at (954) 779-7009.