When entering into a leasing arrangement for commercial office space, you may incorrectly assume that the only amount of money you will pay each month or each year is the cost of the lease. However, leasing office space can yield other costs as well. There are often hidden costs which, if you don’t ask questions or review your lease terms efficiently, you may miss these hidden costs. Here are some hidden costs which may play a part in your commercial office space lease:
Improvement and Upgrade Costs
Even though you are moving into a new commercial office lease, there still may need to be some improvements or upgrades you must do in order to get the premises up to your standards. If the landlord allows such improvements, most likely these costs are not included in the price of the lease. In other words, you will have to pay for any improvement or upgrade costs out of pocket. This is always a good consideration to keep in mind.
Maintenance Costs
Although we would like to think that the leased office will always be in tip top shape, there will sometimes be a need for maintenance services. This is often the responsibility of the tenant and you have to be sure that you will have the money on hand in order to pay for any maintenance costs as they occur along the way.
Operating Expenses
Each month, commercial tenants will have to spend money on various operating expenses. Expenses such as electric bills, shared office space expenses and more will have to be taken into consideration by the tenant. These operating expenses can add up so it is important that the commercial office tenant who leases the office space keeps such costs in mind.
Increasing Tax and Maintenance Costs
When a lease is signed, there is usually a term present within the lease related to tax and maintenance costs being included in the rent. There may also be something related to increasing tax and maintenance costs. This is the increase in costs for taxes and maintenance fees which the landlord sees and wants to make sure that such costs are passed along to the tenant. Although this is a common inclusion, it is one which tenants may not know about, especially if they are new to the office space leasing arrangement.
Pre-Existing Condition Costs
Pre-existing condition costs are pertinent for office space tenants who change conditions of the leasehold estate during their lease term. Many times a landlord will want the property returned to its prior state once the lease term expires and the current tenant moves out. This cost can be great, especially if you make a lot of changes to the property during your leasing term. Make sure that you account for such costs and see if this type of pre-existing condition clause is included in your lease.
All of these hidden costs can be ones which pop up and surprise the commercial tenant. They should be listed in the lease but you have to be sure to spot them prior to signing the lease. With a tenant representative to guide you, you can be certain that these lease terms will not be missed and will be pointed out to you by your representative at the time in which you sign the lease.