Australia’s economic recovery in the final quarter of 2020 was faster than expected, and it’s heading into 2021 with solid footings. Moreover, compared to its wealthy peers, the country has performed better in handling the pandemic, with very low transmission and enormous and timely monetary and fiscal stimulus. For this reason, many are re-visiting their plans to invest in commercial leasing. If you’re one of them, consider these tips:
1. Know Your Rights and Responsibilities
Knowing your rights as a commercial landlord can prevent being taken advantage of. Among the fundamental rights for commercial property owners include:
- Inspection of the property during business hours with reasonable notice to the tenant
- Hold a guarantee in case the tenant defaults on payments
- Request for rent review in accordance with the current lease
Knowing your responsibilities is just as important before getting into commercial leasing. Some of the most common commercial landlord responsibilities are:
- Ensure that the property is clean and safe before leasing
- Ensure that the property is fully compliant with the state and local codes
- Provide commercial property insurance
2 Prepare for Unexpected Expenses
There are circumstances where you have to spend to prepare the property, particularly in a traditional commercial lease.
“It will likely be classified under retail leasing if the property will be used for selling goods and services. In this case, the landlord will shoulder the cost of preparation and maintenance. But it’s still important for lessees to check the local retail legislation as there might be deviation across states.”, says Max Funding business advisor Shane Perry.
3. Understand the Laws Related to Commercial Leasing
Commercial leasing is an entirely different field from residential leasing, especially when terminating a lease.
Residential tenants can be evicted due to delayed payments. But with a commercial rental, you may have to jump through multiple hoops before you can legally evict a tenant.
It’s advised to consult a property manager with a lot of commercial leasing experience to avoid any legal headache. They’re familiar with the laws related to commercial real estate, and it’s their specialty to handle the tenant concerns for the landlords.
4. Never Rush Getting New Tenants
Leaving the property empty for a few more weeks is better than having difficult tenants. You might earn $1000 this month but end up with $3000 in damages.
Check the commercial lease history of your potential tenant and request a guarantor for your protection.
Consider how the tenant plans to use the location because this will primarily affect the occupational arrangements and quality of the premises. You also need to check if their business can cause any issue or inconvenience to other tenants.
Do you want to rent out your commercial property? Are you looking for a property with income potential? Do you need help selling your home?
Real Estate Uno provides a platform for trust and collaboration between property owners and real estate professionals. Contact us now to discuss your needs.
If you want to manage and keep track of your project costs, timeframes, photos, emails and payments then head to TheRealestateUno.com.