Pittsburgh is a thriving locale for businesses. Downtown Pittsburgh alone has seen over $7.48 billion in investments since 2006, making it one of the best spots in Pennsylvania to put down roots. One of the best parts is that real estate investors don't have to worry about business ideas and business owners don't have to buy pricey real estate!
Commercial lease agreements help business dreams become realities. Wondering what you'll find in a typical commercial lease? Read on to learn about four of the most common commercial lease agreement clauses!
1. Use Clauses
Expect your commercial lease to include a clause that specifies how you can and cannot use your rental space. Use limitations occur for many reasons, including Pittsburgh zoning laws and insurance restrictions.
Property owners may also have specific visions for how they want their property to be used. For example, if you lease premium retail space, you likely won't be able to utilize that space for industrial or manufacturing businesses. Instead, you'd have to lease property that suits the day-to-day machinations of your business.
2. Improvements
Commercial spaces are like a blank canvas for renters. Property managers expect that tenants will perform some level of improvements while they're in the space. This may include things like:
- Painting the walls
- Indoor and outdoor signage
- Furniture and equipment necessary to perform work
Renters cannot come in and let their imagination run wild with improvements, however. The owner of the property has the right to restrict the extent of improvements permissible and impose maintenance expectations. When you're negotiating lease terms, this is one of the major areas you want to focus on.
3. Insurance and Indemnification
Renting any commercial space comes with a certain amount of risk. For this reason, most property owners require lessees to carry certain forms of commercial property insurance. Your lease terms specify the types of insurance you must carry and sometimes the dollar amount of coverage.
Property owners may also include indemnification clauses. These prevent lessees from holding the owner responsible for certain types of damage (physical and financial) that occur on the property.
4. Dispute Resolution
Dispute resolution clauses are common in pretty much any type of contract. These clauses describe exactly how the property owner and business owner will proceed should there be any dispute over the terms of the lease. Dispute resolution clauses cover the following specifics:
- Whether you'll go to court or mediation
- The state that has jurisdiction
- Who covers fees
Are Your Commercial Lease Agreements Airtight?
Starting a business doesn't mean you have to invest in commercial real estate. Commercial lease agreements are a great way for you to bring your business ideas to life without breaking the bank. All you have to do is find the right space and review the business lease terms, and you'll be on your way to success!
The Burgh Property Management is ready to help you put pen to paper on a commercial lease. Unlike other property management companies, we are locally owned and have over 20 years of property management experience. Contact us today to learn how we can help you with leasing commercial property!
