- Introduction
- Acknowledgements
- 1: Getting Ready
- 2: The Costs of Space
- 3: Understanding Credit
- 4: Professional Services
- 5: Finding Space
- 6: Residential Leases
- 7: Commercial and Industrial Leases
- 8: Buying Real Estate
- 9: Types of Mortgages
- 10: The Mortgage Application
- 11: Ownership Models
- 12: Purchasing Alternatives
- 13: Chicago Zoning Ordinance
- 14: Chicago Building Code
- 15: Chicago's Neighborhoods
- 16: Property Taxes
- 17: When You Find a Property
- 18: Inspections
- 19: After Moving In
- 20: Insurance
- 21: Utilities
- 22: Rehabbing Your Space
- 23: Safe and Healthy Spaces
- 24: Green Practice
- 25: When Disputes Arise
- 26: Space Emergencies
- 27: Facility Development Planning
- Bibliography
Negotiating a Lease
Once the landlord has presented you with a draft lease, let the negotiations begin. Take it home, read it, ask questions, and request changes, deletions or additions before you sign. Only after reviewing the lease in its entirety will you know what you are being asked to agree to and what amendments you might want to make. Never sign unless you have read and understand the full lease.
As mentioned previously, the law considers landlords and tenants engaged in a commercial or industrial lease as business equals. This means you have fewer legal protections compared to a residential leasee.
List priorities and terms on which you are flexible in order to get the best possible deal. Each clause has an associated value, and some will be more valuable to you than others. If you want a gross lease because you need to know your monthly expenses in advance, and the landlord is willing to give you one, be prepared to make concessions in other areas. Paying a higher rent or signing a longer lease are points you can use as leverage during negotiations.
Your real estate agent or attorney will be very helpful in the negotiation process. If you have undertaken a thorough search and know market values, you will recognize a fair deal.
Unfortunately, not all lease negotiations work out. If you cannot reach an agreement within your budget, or with clauses that meet your needs, you must be prepared to walk away from the space. Have an alternative, back-up space; this will give you more confidence during your negotiations.
Samples of commercial or industrial leases (these links are for educational purposes only and are not legal advice):
Pay attention to the organization and language of these leases to get a better idea of what to expect when assessing your commercial or industrial lease.
If possible, ask a real estate attorney to assist with negotiations of the lease terms. If money is an object, try to have an attorney review the lease before you sign. Many nonprofit organizations have reduced cost and/or free legal services. See the Resource section of Chapter 4: Professional Services for more information.