How to Calculate Lease for Commercial Space by Foot
Talk to a Lawyer
Enter a zip code to speak to a Lawyer that serves your area.
If you are looking to lease commercial space, you will want to be aware that the leasing agreement and procedure is a bit different from that of residential properties. If you are looking to lease out a commercial property, you will certainly want to know how rent is going to be calculated, especially if you are not yet familiar with the process.
Don’t Go in Blind
You found that perfect space to set up whatever venture you wish to pursue. Now, all you have to do is negotiate a lease. Of course, drafting a lease is easier said than done and you will need a bit of know-how before venturing into any agreement. As you sit down to lease the space you will want to discuss with the landlord what is and is not included in the agreement. Knowing this will also help to negotiate the final leasing rate, so make sure to nitpick if you need to. Knowing everything about property taxes, utilities, and maintenance issues is vital to entering into a lease that is both fair and affordable.
The Issue of Space
One of the main differences between leasing a home and leasing a commercial space is how the rent is calculated. When dealing with apartments, homes and other residential properties, the rent is calculated by looking at the rent for other properties in the area. This is not the case for commercial spaces. The rent is calculated by square foot and this where it can become a bit complicated. The Building Owners and Managers Association or BOMA set forth the guidelines which all leasing agreements for commercial properties must follow. Monthly rent is based on two measurements: the Usable Square Feet and the Rentable Square Feet. First instincts tell us that both terms mean the same, but this is not so. Usable Square feet refers to the square footage actually used by the tenant. Rentable Square feet includes any common areas such as storage areas, halls, and closets. You will need to be aware of both measurements for the property in question, since the rate quoted for one measurement can differ drastically from
Drafting the Lease
When drafting the lease for a commercial property, you will want the advice of a lawyer. This is especially true if you are not so familiar with the terms, definitions, and procedures used in commercial real estate. The lawyer will be able to help you with these terms and calculations as well as making sure that the lease reflects a fair price and looks out for your best interests.