The first and most critical office lease terms are typically the amount of rent you will pay and the length of the lease. Depending on the situation, they may be open for negotiation, particularly the length of the term. Leases will often have rent escalation clauses. You should carefully review such clauses and match them with the projected cash flow of your business.

Ø A shorter term lease allows you the flexibility to pack up and leave sooner if you are not pleased with the location. A long-term lease can give you long term stability and keep rent increases down, but may tie you to a location that may not be profitable or one, which your business may outgrow. There are generally ways to break any lease, but it’s not your intent going into such an agreement to seek ways to get out. Among the other key terms you will want to focus on when evaluating a lease include:

Ø What type of lease are you signing?

Ø What charges, taxes or fees are or are not included in the rent?

Ø Which improvements, modifications or repairs are you responsible for and which ones are your landlord responsible for?

Ø Exactly what are the physical boundaries included in the lease? (Are you paying for any common areas such as hallways, stairways or a shared loading dock?

Ø Can the space be assigned or sublet to another party?

Ø How much is the security deposit and what are the conditions for its return?

Ø How can the lease be terminated early and what penalties will you have to pay?

Ø Specifically, what business activities can the premises be used for? Not used for?

Ø How are disputes resolved, should they arise between Lessor and Lessee?

Since there is no such thing as a "standard lease," it may be possible to negotiate the terms, depending on your position. If the space you are looking to rent is highly sought out by other businesses, your bargaining power will diminish greatly. Depending on how valuable the space is to your needs you will need to determine whether or not you can accept the terms of the lease with few or minimal changes.

If you have some leverage in negotiating the terms of the lease, look at several areas in which you can work a better deal. Most often the initial amount of rent will be the most difficult to negotiate.Therefore, you may look at other terms such as:

Ø Rent Escalations: If the landlord insists on rent escalations, try to negotiate that there is no escalation for the first two years and then agree upon a ceiling for increases after that. Such provisions may allow you to sign a longer-term lease. If the landlord has had trouble renting the space, he or she may also want to sign you for a longer term provided there are rent escalations.

Ø Repairs & Services: If the rental price is set, you may be able to make some agreement on repairs and services that will be provided by the landlord, such as a paint job.

Ø Returning the Premises to Their Original Condition: Typically most construction and alterations need to be approved by the landlord. Many businesses improve upon the structure of the original location by adding additional wiring for computers and additional telephone lines as well as enhancing the capacity for other technology. You may be able to negotiate that such upgrades can remain and that you do not have to return the premises to their original condition. In addition, you may be able to use the fact that your technological improvements will increase the value of the property as a bargaining chip. Before negotiating terms of a lease, make a list of terms that would benefit your business. For example, if you are opening a jewelry store in a mall, the lease should stipulate that no other, or only one other jewelry store, can open in the mall during the term of your lease. If you are expecting to generate walk-in business, you will need terms that allow you to put up necessary signage. Whatever type of business you are opening, there are specific needs that will have to be discussed prior to signing a lease. In addition, make sure that zoning ordinances do not prohibit you from opening up the type of business you chose to run. As is the case with any negotiation, the side with the greater need will have less bargaining power. A building owner or landlord who has had an empty storefront or office space for an extended period of time will be more agreeable to your terms including options. The owner may have a greater need to rent the space.

With almost 3,000 active principal brokers to choose from in New Hampshire it can be overwhelming trying to select the right one to lease your commercial space or negotiate a lease for your business. If you choose the wrong one, you can end up with bad advice or miss out on a winning bid for your commercial property in a competitive market. How do you find a seasoned Realtor® that understands your unique needs for leasing, buying or selling commercial real estate and provides top quality service and shares your values in environment and social responsibility? You have as you are on the web site of the Wm. E. Barry group LLC in Manchester, New Hampshire.