Tag: st louis commercial real estate

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How to Craft a Flexible Lease

Even if you have a clear vision for your company and a smart strategic plan to help you get there, the future is unpredictable. The office space that’s ideal for your needs today could end up being a less-than-perfect fit before your lease expires. Making your office lease as flexible as possible is a way to hedge against this unpredictability. Here are a few of the ways that you can create a more flexible lease: Consider a Shorter Term “Short-term” lease is a relative term. For a tech startup it might mean month-to-month. For an...

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Relocating? A Guide to How Much Time You Need

  Market conditions, the size and complexity of the transaction, and option notice dates can help determine when to begin the process of evaluating your office lease. Time should be your ally, not your enemy during negotiations with any landlord. Landlords know that other buildings you’re considering will most likely have to create a space plan, get construction pricing, agree on a rental rate, prepare and execute a lease document, apply for construction permits and prepare the space for occupancy. This is, at a minimum, a 4 to 6 month process. So a tenant who...

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WATCH OUT!…THE DEVIL’S IN THE DETAILS

The Restoration Provision When reviewing a multipage, landlord-centric commercial lease it’s easy to get glassy-eyed and often overlook seemingly harmless language. The restoration provision, usually tucked away under the Surrender of Premises Clause in your lease, is a perfect example and could be a potential tripwire hiding in plain sight. It’s a legal obligation for a tenant to restore, at the landlord’s request, the premises back to the condition it was in before you moved in or remove alterations and improvements as the landlord sees fit. This could be a very expensive parting gift to your...

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Commercial Real Estate Lease vs. Purchase

The purchase side of the lease vs. purchase equation usually comes into play when your company’s needs are fixed and predictable for the long term. If you know that your needs won’t change for at least a decade or more, purchasing can be a good option. It gives you total control over your space and a great deal of certainty over cost and what you can do with the space since, after all, you own it. Is it best to lease or purchase commercial space? The type of business you have, your future goals, your...

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The 3 Most Commonly Used Leases in Commercial Real Estate

There are 3 basic types of leases used in Commercial real estate. They are all complex documents but can be understood when you have some background about the terminology associated with each of them. The three types of leases are: 1. Gross Lease  With a gross lease, also known as a full service lease, the rental rate includes all of the operating expenses for a property, such as the utilities, maintenance, property taxes and property insurance. If these expenses increase over the term of the lease, the landlord typically passes through the incremental cost to the...

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Should I Stay or Should I Go?

  As the life cycles of businesses mature and grow over time it becomes necessary to re-evaluate your office space when your lease is coming up for renewal. Square footage requirements factor as just one component of the decision process to remain where you are or look for new space. A comprehensive evaluation also includes the following issues in today’s modern business atmosphere and serve as a guide to stay or go. 1. Are You Using Your Square Footage Efficiently? Take a hard look at where your business is now and where it’s likely to...

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What is CRE Dual Representation?

If you’re involved in any leasing/purchasing real estate process it’s likely you’ve come across the term “dual representation” and it’s basically this: dual agency representation happens when the same broker or firm represents both the tenant and landlord in the same transaction. It’s common to find this happening when big firms are involved in the process. What might seem like an ideal solution at the time can cause problems during the transaction because it’s not possible to represent both parties fairly in dual representation real estate transactions. There are too many conflicts of interest between...

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What Should You Expect From Your Commercial Real Estate Advisor?

The logic behind a commercial real estate advisor who specializes in tenant representation is that in order for a tenant to secure the best possible contract terms they will need access to market information, transaction expertise and negotiating skills equal to that of the landlord who utilizes professional representation. Tenants should look for a real estate advisor who specializes in tenant representation with the appropriate market knowledge, relative experience and most importantly is someone they can trust to assist them with an important business and financial decision. Your advisor should: Be willing to invest the...

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Considering a Relocation? A Guide to How Much Time You Need

Market conditions, the size and complexity of the transaction, and option notice dates can help determine when to begin the process of evaluating your office lease. Time should be your ally, not your enemy during negotiations with any landlord. Landlords know that other buildings you’re considering will most likely have to create a space plan, get construction pricing, agree on a rental rate, prepare and execute a lease document, apply for construction permits and prepare the space for occupancy. This is, at a minimum, a 4 to 6 month process. So a tenant that waits...

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Explore Your Alternatives Before Exercising Your Lease Renewal Option!

Each lease expiration should be viewed as an opportunity to explore and develop alternative space options. Only after an exhaustive search can the decision to either renew or relocate be made with confidence. Needless to say, this can be a lengthy process which should start well in advance of the lease expiration depending on the size of the requirement. If your first choice is to renew, this process will provide the much needed leverage you will need when negotiating with your current landlord. Most commercial leases typically run between 5-10 years. In well negotiated leases...

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