If you’re a business owner searching for a commercial property for lease in Calgary, you already know that it’s one of the biggest financial commitments you can make. The process can be quite extensive, and the decision requires an in-depth understanding of many aspects that could impact your business for better or worse. While it’s important to know the benefits of working with a commercial real estate agent, it’s just as valuable to learn about the pitfalls you’ll want to avoid.
Mistake #1 – Not hiring a commercial real estate broker
Think of a broker as someone who represents you with a deep understanding of the commercial real estate market. They have the resources and the network to find you a better deal than what’s offered and finds commercial real estate in Calgary on your behalf that meets your specifications.
Brokers have the skillset to negotiate a favourable lease for you and the industry knowledge for your particular business. If you’re concerned about the cost of hiring a commercial real estate broker, consider the return on your investment. A broker can secure lower rent, tenant incentives, and a location that’s more suitable for your particular needs. This brings us to our next point…
Mistake #2 – Only looking at public listings
You might be missing out on some incredible property by limiting your search to public websites. There are commercial properties for lease in Calgary that aren’t listed publicly, highlighting another advantage of hiring a broker to search on your behalf. They not only have access to private listings, but a reputable broker also has a network of connections to commercial property owners with who they’ve built a trustworthy relationship.
Mistake #3 – Skimming through lease terms
While it’s tempting to skip through the jargon on your lease contract, you should never sign off on a commercial property for rent if you don’t understand each area. This is where a commercial real estate lawyer and broker can answer your questions and help you understand the factors pertaining to the lease, including:
- Repairs and maintenance obligations
- Rent obligation, including increases
- What type of lease term it is
- Early exit terms
- Additional costs
Mistake #4 – Only focusing on the price
Renting a commercial property is easily one of the largest expenses for a business, so it’s understandable that business owners are initially attracted to a listing with low rent. Although it’s important to stick to your budget, moving to a commercial property that’s affordable but doesn’t meet your business needs can cost you more in the long run.
The location of your business, accessibility, amenities available, the infrastructure, proximity to competition, and many other factors can make a significant impact. If you find a property that is a little over your budget but opens up new opportunities and helps your customers easily find you, the increase in business can negate the additional costs and help you scale steadily.
Mistake #5 – Not considering future needs
Many business owners make the mistake of focusing their commercial property search based on their current needs. While this is important, there are lease terms you can negotiate that will make sense for the trajectory of your business. For example:
- A first refusal clause – You can claim rights to a property’s additional space as it becomes available, ideal for businesses that are anticipating rapid growth.
- Sublet or early termination clause – Provides you with the option of an early exit before the lease term expires, ideal if you want to protect your business during a financial decline.
Moving offices because your business has grown is a great problem to have – however, it’s also costly. Renting a commercial property in Calgary with more space than you need can be a cheaper option than having to find a larger space, move, and factor in downtime. Before entering a commercial lease contract, be sure to take the above information with great consideration. The property you choose ultimately sets your business up for the future.