Leasing industrial space is a significant step for any business, whether you’re expanding your operations or launching a new venture. However, the complexity of industrial leasing can lead to costly mistakes if you’re not careful. Avoiding these common pitfalls can save your business both time and money. Below are five mistakes to steer clear of when leasing industrial spaces for your business, brought to you by Wanda Eilers, a trusted tenant representative in Calgary specializing in commercial, industrial, and retail leasing.
1. Not Understanding Zoning Laws
- The mistake: Many businesses overlook local zoning regulations before signing a lease, only to find out later that their operations aren’t allowed in the space.
- Why it matters: Zoning laws dictate what types of businesses can operate in certain areas. For example, if your business involves manufacturing or warehousing, ensure the property is zoned for industrial use.
- How to avoid it: Always verify that the property is properly zoned for your business activities before committing to the lease. Wanda Eilers can help you navigate local regulations to ensure compliance.
2. Overlooking Maintenance and Repair Responsibilities
- The mistake: Assuming the landlord will handle all maintenance and repairs can lead to unexpected expenses. Industrial spaces often come with unique maintenance needs, from large HVAC systems to specialized electrical setups.
- Why it matters: Some leases place the responsibility for costly repairs and upkeep on the tenant, which can lead to unexpected financial burdens.
- How to avoid it: Carefully review the lease to see who is responsible for maintaining and repairing the property. Wanda Eilers can negotiate clear terms to protect your interests and avoid surprises.
3. Ignoring Future Growth Needs
- The mistake: Leasing an industrial space that meets only your immediate needs without considering future growth can backfire.
- Why it matters: If your business grows and you need more space, you may find yourself locked into a lease that doesn’t allow for expansion or subleasing.
- How to avoid it: Plan for future growth by considering spaces that offer flexible leasing terms or expansion opportunities. Wanda Eilers specializes in finding industrial spaces that not only meet your current needs but also allow room for future growth.
4. Signing Without Knowing CAM Fees (Common Area Maintenance)
- The mistake: Many business owners focus solely on the base rent and overlook Common Area Maintenance (CAM) fees, which can significantly increase monthly costs.
- Why it matters: CAM fees cover shared expenses such as property maintenance, landscaping, and security. These fees can fluctuate and sometimes rise unexpectedly.
- How to avoid it: Before signing, ask for a breakdown of CAM fees and how they are calculated. Wanda Eilers can help you understand these costs and ensure they fit within your budget.
5. Failing to Negotiate Lease Flexibility
- The mistake: Accepting a rigid lease agreement without room for flexibility can hurt your business down the road if your circumstances change.
- Why it matters: You might need to relocate, expand, or downsize during your lease term, but without flexibility, you could face stiff penalties or be forced to stick with a space that no longer fits your needs.
- How to avoid it: Negotiate terms such as the ability to sublease or include early termination options. Wanda Eilers has experience in negotiating favorable terms that provide flexibility while protecting your business interests.
Bonus Tip: Consult with a Tenant Representative
Industrial leasing is more complex than many other types of commercial real estate, and mistakes can be costly. Working with a tenant representative like Wanda Eilers ensures that you avoid these common pitfalls, saving you time, money, and headaches. Wanda will help you navigate every step of the leasing process, from finding the right space to negotiating favorable terms.
By avoiding these five common mistakes, you’ll set your business up for long-term success in your industrial space. With Wanda Eilers by your side, you’ll have the expertise you need to make informed decisions and secure the best deal possible.
