It’s seemingly hard these days to access just about any media source and not see a steady stream of stories spotlighting the real estate industry.
And that is for this obvious reason: That specialized niche area of the nation’s economy is in full-speed mode.
In fact, and in a word, it is booming. Properties – both residential and commercial – readily tell a tale of frenetic transactional activity.
Much of the focus is on the heady residential market, but the commercial real estate industry has also been on a steady upswing in recent months.
And that of course implies a number of factors relevant for buyers and sellers, as well as other market participants. Today’s blog post focuses specifically on that latter demographic, underscoring the importance of commercial lease negotiation and execution for business landlords and tenants.
The central placement of commercial leases in the business realm
Major realty purchase/sale transactions frequently occur in Louisiana and nationally, but business principals focused on headquarters and operational space more commonly investigate commercial lease opportunities.
That is for a number of reasons. Less up-front capital is customarily required in a lease transaction. A lease can be often be executed relatively quickly. Wiggle room on various points (negotiating space) likely exists. A lease can provide for much-coveted flexibility in both the short and longer term.
An in-depth legal overview of commercial leases notes immediately the unique parameters of those contracts, readily distinguishing them from residential leases and underscoring some of their key points.
Some key considerations relevant to commercial leases
The terms and conditions of a commercial lease will likely differ materially in every instance, making it advisable for either a prospective landlord or tenant to secure timely and on-point counsel from a proven business law legal team. Following are some key considerations relevant to commercial leases:
- fewer legal protections than what are provided for in residential leases (the above overview stresses that “lawmakers assume business people are more knowledgeable”)
- highly varied and often longer terms
- allowance for negotiation on many points
That last bullet point is often critically important relative to many issues. Rental amount obviously spells subject matter that commercial parties will often debate. The same is true concerning a requested security deposit, improvements to a property, the posting of business signs, permitted property use, assigning/subletting rights and more.
Commercial lease law is evolving and complex. An experienced attorney team can help ensure that a client seeking to negotiate and execute a lease contract is well advised and optimally represented in every aspect of a transaction.