5 Questions You Should Ask Your Landlord Before You Sign a Lease
Wouldn't it be nice to have a list of questions that you need to ask every landlord?
As a landlord of commercial office space and industrial space, we have heard every type of question from prospective tenants. Some questions catch us by surprise (“Can we paint the warehouse floor bright yellow?”) and some questions are to be expected (“What is the average monthly power bill?”).
1. Other than monthly rent, what additional charges can we expect?
You would be surprised with how many people do not ask this question. As responsible landlords, we always reveal what additional charges there are before a lease is signed (even when not asked and even though such charges are covered in our lease). However, before you can make an intelligent decision about an office space or warehouse space to rent, you need to have an accurate view of your additional expenses.
2. May we see a copy of your standard lease agreement?
Before you get too far into discussions and spend too much time negotiating back and forth, you should ask for a blank copy of a lease agreement.
Picture this scenario: You negotiate back and forth with your prospective landlord on the price and term of the lease. Other items are discussed, such as property taxes and insurance. The landlord tells you that the tenant is not responsible for property taxes or property insurance. Several months pass and at last, you have reached a verbal agreement with your landlord. And just in time, because your existing lease expires in 30 days. Then, you get the lease form for signature. Surprise! Property taxes and property insurance are passed through to the tenant in the form of additional rent. The landlord clarifies what was meant - the landlord pays the original bills in a lump sum and the tenant pays one-twelfth of the bills each month on top of the monthly base rent. The landlord "thought" the tenant meant whether the tenant paid the actual property tax bill and was responsible for finding an insurance policy. You formulated budgets based on a significantly lower monthly rent and cannot justify this additional expense for your business. Meanwhile, you now have 30 days to move out of your existing space and find a different space to lease. What now?!
And we think it is understood that you actually need to read the lease agreement. And we mean every word of every paragraph in every section. Landlords are sophisticated parties and each word of each provision is in the lease for a reason. If you do not understand what something means, ASK! And if the landlord is of no help, you might need to retain representation, whether it be an attorney or real estate professional. Remember, your lease agreement is what will govern the relationship between you, as the tenant, and your landlord. So if the landlord told you something that is not reflected in the lease, you need to address it before you sign.
3. May we take pictures of the spaces we tour?
Ask if you can take pictures of the office spaces or warehouse spaces you tour. Not all landlords will allow you to take pictures (for various reasons). We typically allow our prospective tenants to take as many pictures as they want (as long as we are not in the picture!). Typically a prospective tenant only sends a representative to tour the space. Pictures allow everyone in the office to review and brainstorm.
4. How long has this space been vacant?
This question might give you some leverage in negotiations. A landlord might be unwilling to budge on the monthly rent if a property is fresh on the market. However, an office space or warehouse space that has been vacant for several months (or years for that matter) might go for less than the asking price. Landlords like to keep spaces occupied because vacancies cost them money. You might be able to squeeze out a better deal with this knowledge.
5. What is the process for repairs?
This is a bit of a loaded question. First, it depends on whether the tenant or landlord is responsible for the cost of the repair. Second, even if the tenant is responsible for the cost, the landlord might be responsible for performing the repair. For the purpose of this question, let’s assume it is the landlord who is responsible for the cost and performing the repair for the HVAC system. Your A/C or heat stopped working, (and trust us, the HVAC issues always happen in the hottest or coldest part of the year) and you call your landlord to notify them of the issue.