Gullible's Travels: Signing a Lease without Getting Suckered
By Robert Price |
Like Gulliver, who found himself pinned to the ground by Lilliputians, it's the little clauses in a lease that can tie you up in knots.
Everybody knows that you should never sign a major contract like your store's lease, without consulting a lawyer and understanding it inside out. Like eating healthy and driving with a seat-belt, knowing your lease is sage advice many retailers forget until it's too late.
If you are signing a new lease, or looking at renewing a lease, here are some tips to help you enter negotiations with renewed vigour. |
TOP FIVE QUESTIONS TO ASK BEFORE SIGNING A LEASE
Curiosity is the retailer's best defence against a bad lease. Asking questions, knowing what questions to ask, and getting answers from a good lawyer will help protect you from signing up with a sketchy landlord.
Richard Mask and Jeffrey Selby, Partners at Parlee McLaws LLP, contributed what they feel are the five questions retailers should ask before signing any lease. |
1. Who is your landlord?
This may seem like an obvious question, but it's one of the most important questions to ask. You'd run a background check on your babysitter, but you might not give the same attention to who your landlord is, especially if the landlord has your dream space for rent.
"Retailers, unfortunately, in signing leases, are signing the most significant contract in their business," says Selby. "In entering a contract, you want to know how that person will treat you and if they will have sympathy for you and your business."
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Retailers can get to know who they are dealing with by talking to other tenants, examining the state of the property, and researching the landlord through public documents, such as court records, the credit bureau, and of course, the Internet.
Mask, Chair of Parlee McLaws' Commercial Real Estate Practice, says retailers need to know the track record of their landlords, especially if they are renting a space in a new development.
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