Before you execute a commercial industrial space lease contract it’s crucial that you do your due diligence to confirm that you and the landlord are on the exact same page as to who is liable for what.
There are lots of nuances to renting industrial and warehouse properties and even small errors might be very costly. Not all warehouse properties provide the identical features so make sure to ask the landlords a lot of questions regarding them and enlist the services of experts (e.g. electrical installer) if necessary to confirm that the properties will meet your needs. To help get you started below are a few things you should really consider when renting Warehouse or Industrial properties:
Heating systems,Ventilation,and Air Conditioning (HVAC)– Many Industrial properties aren’t delivered with full building HEATING AND COOLING. In the case that they choose to get it each tenant is on the hook for the installment of their own HVAC unit. In a bunch of cases you wind up renting a space that had been already leased by another occupant else and they had set up and used an HVAC unit. Given that you usually do not know if that company appropriately cared for the unit make an effort to avoid assuming obligation of a possibly neglected unit.
Negotiate with the landlord that you will purchase a HVAC SYSTEM routine service contract to keep the existing HVAC system property cared for,however if the unit needs to have a major repair job or replacement the landlord ought to be responsible. Prior to executing the contract make sure you require that the landlord get the HVAC systems inspected and fixed (if needed) and confirmed in writing that they are in excellent working condition by an accredited HVAC tech.
Operating Expenses (also known as NNN)– Ensure that you learn what is and what is not included in the operating expenses and what can possibly be omitted (e.g. roof repairs ). Operating charges in most cases include taxes,property insurance,and repair and maintenance. You need to figure out what the landlord is going to pay for and what you will be accountable for. You also want to know how tocalculate your monthly warehouse rental cost
Square Footage — Some landlord determine the square footage in different ways. Be sure you know how they are doing their computations and what they are incorporating. Preferably you solely desire to pay for your usable square footage which is the actual area you occupy. Some landlords will certainly try to incorporate the area underneath the facilities drip lines and some will make a decision to to calculate from the exterior of the wall surface vs the middle or inside.
Parking Area– Parking lots require repair and maintenance (asphalt or concrete) and a few property owner’s try to make the tenants pay for this. Repair services and maintenance should really be the landlord’s obligation because is a very long term expenditure and a component of future commercial real estate market value computations. What is the operation of the parking? Who will be utilizing the parking the most? Do you require to be able to park box trucks or cars overnight? If so make certain you have the capability to.
Zoning– Guarantee the Industrial or warehouse commercial property is zoned for your intended use. Some retail tenants (e.g. martial arts) love the thought of renting an industrial property because the lease prices are much cheaper than retail. However if the space is not zoned for retail usage tenants will not be able to lease it… except if the tenant or the landlord is willing to apply for a zoning revision. You likewise want to verify the property’s parking ratio (spaces per 1000 sf) is enough for you. If you may need more then think about some other facility or look at retail space.
Repairs and maintenance of the commercial property– See to it you determine what the landlord is responsible for and what you are going to be responsible for. Garbage will typically be your cost.
docking areas– Will you have goods delivered or picked up via 18 wheeler or UPS type trucks? If so then you will require dock high loading and a truck court big enough for 18 wheelers to maneuver. Do you need to have the ability to operate box trucks or other types of motor vehicles inside the warehouse space? If so then you really need grade level loading. Whatever the case make certain you inquire if the warehouse space has what you really need or if the property owner agrees to build what you need. Trailers and trucks used to be 45 ft +/- although these days the 18 wheelers are 60 ft +/-. What this suggests is you have to have around a 120 â ² turning radius. Some older Industrial buildings might not be able to accommodate this.
Electrical– Make sure the warehouse buildings have electrical power adequate for your requirements. Do you need 3 phase power? If you or the property owner does not have knowledge of what is available then employ an electrician or electrical engineer to examine the property. You want to make sure the property has ample amperage and power so you don’t blow transformers or figure out it is underpowered later on.
Ceiling Height– Make sure you inquire how high the ceilings are. If you plan on stacking items or equipment or operating large equipment you want to ensure you know how high you’re able to go. Heights usually vary from 18 feet to 25 ft.
Expansion options– Ask the landlord if any surrounding tenants have renewal options. If you count on growing later it might be good to know if you have the capability to do so. If your neighbors have an expansion option on your space then negotiate to get the property owner move you at the lessors expense.
Floor Load– What is the flooring load with regard to the cement slab vs what your anticipated use will be ?
These are just a few points you need to diligently analyze in advance of executing an Industrial or Warehouse lease. If you have any questions pertaining to renting out warehouse property for lease or want to know how to compute your monthly warehouse rental costs do not be reluctant to connect with us!