Commercial Real Estate Leasing

Chicago Commercial real estate leasing is usually not a frequent occurrence in any business executive's career. As most leases are very long-term, an average executive may not sign more than one or two of them in his entire career. So seeking professional help in signing a Chicago commercial real estate lease is a must to avoid costly blunders.

But before you blindly trust a Chicago commercial real estate professional, learn some basics of the leasing process so you are not at mercy of your agent's level of competence. Understanding the lease process, from beginning to end is not rocket science; it's just a matter of employing good business practices.

Do Your Research and Be Prepared

Try and analyze your company's needs to determine your square footage requirement. Don't lease a space that is too small for your needs. When you expand and grow you will find that the area you leased was completely inadequate. In the lease, include the option of expanding your space if the need arises.

Get the help of an attorney who is an expert in the Chicago commercial real estate market. An attorney should be a key member of your lease negotiating team.

Don't sign the landlord's standard lease agreement. A standard lease may not be a fair lease. It may be completely in favor of the landlord! So ask your attorney to go through the document carefully and suggest changes where the lease is blatantly in the landlord's favor. The landlord wants you to indemnify him against everything but does he indemnify you? Check it out.

Make a comparative analysis based on a market survey of the various properties and choose one that meets your present and future needs. Make contingency clauses in your lease to get out of the property if the company is facing a downturn or problems with present location.

Reading the Fine Print on Your Lease

Leases are usually very long and complex. They are often printed in very small type and everyone hates to read them. Big companies, with their in-house law and real estate expertise, are used to modifying leases to their own requirements and landlords are used to negotiating those changes. If you are a small business, you're going to have to do a little work to protect yourself.

For example: If a large tenant wants your space, does the landlord have the option to relocate you elsewhere in the building? Most leases say the tenant can be relocated into "similar" space and the landlord will pay for some moving costs. What if the new space is larger? Do you have to pay more? Does the lease protect you? How much time do you have before you must tell the landlord whether or not you will accept the move and can you reasonably refuse or do you have the option to cancel the lease?

Check the "Additional Rent" or "Common Area Maintenance" section of the Chicago commerical real estate lease. It can be confusing but don't neglect it as some unfair provisions can find their way in there and you may end up paying more than you should. Find out what your company has to pay as part of this provision and get your attorney to check if it is fair.

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