COMMERCIAL LEASE – what does it mean for me ?
If you’re taking on a lease of a commercial property, you’ll need to take expert legal advice on your position before you sign on the dotted line so that you know exactly what commitment you’re making. Even if you have a limited company to take the Lease, landlords will often insist on a personal guarantee, so you need to be aware of all the implications. We’ve seen many cases where someone is so enthusiastic about their business and so keen to get into the new building to start work that they don’t really think about the consequences. You need to make sure that the terms of the Lease and any Licenses to alter the premises or assign it or sub-let it are properly set out so that you know all the implications, such as how quickly you can get out if things were to go horribly wrong. You need to also make sure you understand your obligations for any repairs or re-decoration and obviously budget for those costs. Don’t forget to include the service charges, business rates and any rent reviews.
Always push for a sensible break clause in the Lease so that you can review matters as you go along and adjust your requirements as your business develops. You don’t want to get locked into a 15 year Lease without a reasonably early break clause in case you need to re-adjust your business plans quickly, particularly in tough times. On the other hand, you also need to make sure that you have sufficient security for your future plans so it’s important to take your time and get legal advice on this really vital part of your business planning.