You are searching for the perfect commercial property for your business. Perhaps this is the first time or you are looking to relocate your current brick and mortar store. Once you find that property, you need to sit down with the landlord and discuss a few things.

The first item of business usually is the cost of the lease itself. Lease costs are determined in two steps:

  1. The monthly cost is determined by multiplying the square footage by the cost per square foot, which gives you the annual cost, then dividing by 12 for the monthly cost.
  2. The “Common Area Maintenance” (or CAM). The common areas are spaces that are “outside” the general office space, such a hallways, driveways, some restrooms, a breezeway if the building has one, etc. These areas need to be maintained, but if you are only leasing a portion of a bigger building, you shouldn’t have to pay the full cost. In some cases, the cost is shared, in others, the building owner takes care of it, and yet in others you pay the building owner back for these costs.
  3. You want to discuss what is included in the lease. This includes the above costs, but the lease should also include such costs as the following:
    • Property taxes (pro-rated on the percentage of the building included in the leased space).
    • Snow removal, lawn mowing and landscaping.
    • Driveway, sidewalk, parking lot repairs and maintenance.
    • Utilities (electricity, gas, sewer, water).
    • Collecting garbage.
    • Insurance on the property (pro-rated among the tenants).
    • Structural and non-structural repairs and maintenance.
    • Mechanical system repairs, maintenance and replacements.

The landlord will tell you how many of these items are included in the lease payment, and how many you will need to pay yourself.

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