Pay Special Attention to the Commercial Lease

In the excitement of forming a new business, whether a person is purchasing a franchise or forming a new business from scrape, one critical step in getting the business started usually gets little attention by the business owner – the commercial lease.

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With everything else new business owners have to decide, they tend to spend too little time understanding the commercial lease.

Before business owners sign any commercial lease, they must read it and know what it means. This seems like common sense, but many people start reading the lease – normally a substantial number of pages with a bit of "legalese" – and then stop, assuming the lease conforms to what they were told by the leasing agent. For more information about the commercial lease you can also visit

There are a number of provisions that you should be aware of.

o Know your total cost. In many commercial leases, the tenant pays a base rent amount per month, plus a portion of taxes, insurance and maintenance of the building and its common areas.

In a shopping center lease or in a lease to a restaurant, there may be additional payments required that are a percentage of the tenant's gross sales.

o Know the building. You should know how old the building is and when major repairs to heating and cooling systems, the roof and common areas were last completed. Otherwise, you may be surprised by a bill for your share of work on these items.

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