10 Tips for Negotiating a Commercial Lease

💼 10 Tips for Negotiating a Commercial Lease

1. Do Your Homework First
   Research market rents, lease types, and comparable properties in the area so you walk into negotiations informed and confident.

2. Don’t Accept the First Offer
   Landlords often expect negotiation. The first draft of the lease usually favors them—counter where needed.

3. Negotiate More Than Just Rent
   Focus on rent increases, free rent, build-out allowances, renewal options, and exclusivity clauses. These can be just as valuable as a rent reduction.

4. Understand the Total Cost of the Lease
   Ask for a breakdown of CAM charges, property taxes, insurance, and utilities. Net leases can sneak in extra costs.

5. Ask for Tenant Improvement (TI) Allowances
   If the space needs modifications, try to get the landlord to cover some of the build-out costs.

6. Add Favorable Exit Clauses
   Include early termination options, sublease rights, or “go-dark” clauses if your business must shut down temporarily or permanently.

7. Lock in Renewal and Expansion Options
   Protect your future with pre-negotiated renewal terms and first rights to adjacent spaces.

8. Limit Personal Guarantees
   Try to cap your liability. Negotiate for a “Good Guy Clause” or a limited guarantee that reduces risk to your personal assets.

9. Clarify Maintenance and Repair Obligations
   Define who’s responsible for what—roof, HVAC, plumbing, windows, etc.—to avoid disputes down the road.

10. Hire a Commercial Real Estate Expert
    An expert will catch lease traps, vague language, and landlord-favored clauses that could cost you later.