Are you tired of getting untimely calls from tenants to fix a leaking tap? Is your landlord continually threatening to kick you and your business out of his property?
Whether you are a businessman, who has decided to invest in real estate or a landlord thinking to rent out his unit or whether you are a businessman and are confused whether to use a commercial space Brooklyn or residential unit getting the right commercial property is important. Before deciding the type of property to use here are a few which commercial space has over residential property.
- Long lease term
Many residential properties only have a one-year lease. However, most commercial property tenants want to have a long lease term. Having a long-term lease will ensure that tenants have the same overhead costs. Long-term leases also benefit landlords as well. Also, a long-term lease will make the bank to consider refinancing.
- Reduced chances of payment defaults
Medium and large companies are much more likely to default in payment, unlike residential businesses which have limited resources. A big company will want to have stability because of its customer base hence it will have to pay upfront for months or even years making it easy for you as the landlords to negotiate a fixed sum of deposit. Moreover, a commercial property tenant won’t leave the premises anytime soon because of the investment they have made.
- Paid improvements by the tenants
Unlike with residential property commercial spaces usually require improvements. The space should meet all the particular requirements which the tenant wants. In commercial spaces, the tenant is the one who makes these improvements to suit all of their needs. This may require simple to full renovations in the space.
- No rent control laws
The rent of residential property might escalate only up to the limit which is stated by the state law. However, this is not the case with commercial spaces. If a business gets settled in a certain location, the chances are that the business won’t relocate anytime soon.
- Comfort and collateral value
Commercial spaces which are in prime locations like market places and malls are most likely to get you people in business and entrepreneurs who would want to lease the space for a long time. This also assures you as the landlords a good income over a long period of time. This creates a win-win situation for both the tenant and landlord.
In commercial spaces the landlord and tenant enjoy exclusivity. Exclusivity limits the place where a tenant may open if they vacate from your premises. The landlord is also limited to whom they might lease the space too. The tenant also agrees that they will not open up a store near that location when they move out.
There are various advantages which you can get with renting or owning a commercial property as a business person. However, there are some flaws also involved but which can be minimized. The risks incurred can be minimized by the proper alterations in your contract.