COMMON QUESTIONS

In this article, we’ll break down the essentials of commercial lease properties—what they are, the benefits and challenges of leasing space, and how the negotiation process works. You’ll learn about the different types of commercial leases, the critical factors to evaluate before signing an agreement, and how to approach negotiations to protect your interests.

We’ll also outline the questions every business owner should ask, the key terms that can make or break a lease, and the typical timeline you should expect for completing a deal. Whether you’re a property owner looking to attract quality tenants or a business owner searching for the right space, understanding these fundamentals will help you make informed decisions, negotiate with confidence, and secure a lease that supports long-term success.

Key Considerations When Leasing Space

Before signing a commercial lease, businesses should carefully evaluate:

Location & Accessibility → Is the site highly visible, convenient for customers, and positioned near suppliers and employee amenities?
Rental Structure & Lease Terms → Understand the base rent, escalation clauses, renewal options, and additional operating expenses (CAM, taxes, insurance).
Property Condition & Infrastructure → Confirm the quality of HVAC, plumbing, electrical systems, and who is responsible for ongoing maintenance.
Zoning & Use Restrictions → Ensure the property is zoned appropriately and there are no restrictions that could limit your business operations.
Parking & Logistics → Adequate parking for customers and staff, plus loading areas or storage if your business requires it.
Competitive Landscape → Evaluate surrounding businesses—both complementary and competitive.
Ingress & Egress → Verify that access points, sidewalks, and delivery areas can support your operations.
Lease Agreement Review → Every clause matters. Work with an experienced commercial real estate advisor to negotiate favorable terms.

📌 Pro Tip: A professional broker can help you compare multiple options, negotiate with landlords, and identify hidden costs that may not be obvious upfront.

How Long Does It Take to Complete a Commercial Lease?

The timeline varies based on property type, lease complexity, and negotiations. On average, the process can take several weeks to a few months.

Typical stages include:

Property search and site selection
Lease negotiations
Document review and revisions (often with attorneys involved)
Final execution and funding (security deposit, fees, etc.)

Thorough negotiations may feel time-consuming, but they’re essential to ensuring a fair, sustainable lease.

Minimum Lease Terms

Most commercial leases require a minimum term of 3 years, though it can range from a few months to 10+ years depending on property type and landlord requirements.

💡 Tip for Tenants: The longer the lease term you can commit to, the more leverage you typically have to negotiate other favorable terms—such as rental rate reductions, tenant improvement allowances, or renewal options.

Financial & Legal Considerations

Hidden Costs → Insurance requirements, utilities, janitorial services, and build-out costs that may not be obvious in the base rent.
Security Deposit & Guarantees → Typical amounts, personal guarantees, and how they affect financial risk.
Operating Expenses → Difference between NNN (triple net), gross, and modified gross leases, and how that impacts monthly expenses.
Legal Review → Why tenants and landlords should always involve a real estate attorney to avoid unfavorable clauses (like relocation or demolition rights).

Physical & Operational Considerations

Tenant Improvements (TI) → Who pays for the build-out? How allowances work.
Expansion & Flexibility → Whether the lease allows you to grow into adjacent space or sublease if your needs change.
Signage Rights → Monument signs, building signage, or window signage can drastically affect visibility for retail tenants.
ADA & Code Compliance → Making sure the property meets accessibility and safety codes.

Market & Negotiation Factors

Market Comparisons → Importance of comparing rents, vacancy rates, and incentives in competing properties.
Concessions → Free rent, TI allowances, or landlord-funded improvements that can be negotiated.
Renewal & Exit Strategy → Why renewal options, early termination rights, and assignment/sublease clauses are critical.
Percentage Rent → For retail tenants, understanding if and when sales-based rent applies.

Relationship & Long-Term Success

Landlord Reputation → How responsive, fair, and financially stable the landlord or property manager is can make or break your leasing experience.
Community Fit → Whether the property aligns with your brand, customer demographics, and growth strategy.
Sustainability Features → Energy efficiency, green certifications, and how they affect operating costs and tenant appeal.