As a restaurant owner, signing a commercial lease, particularly a long-term triple net lease, requires careful consideration. This type of lease can significantly impact your business’s profitability and future growth.
Ultimately, you have to make decisions that are best for your restaurant. The only way you can do this is to fully understand the terms of the lease you’re signing.
Check the lease terms
What is a triple net lease? This is a type of lease in which you, as the tenant, are responsible not only for the rent, but also for property taxes, insurance and maintenance costs. You will need to ensure you fully comprehend these obligations and that they are clearly stated in the lease.
Consider the lease length
A long-term lease can provide stability and can lock in your rental rate, protecting you from sudden increases. However, it also means you’re committed to the location for a significant period. If your restaurant doesn’t perform as expected, you could be stuck with a burdensome lease.
Look at the location
You also need to consider the location’s suitability for your restaurant. Think about the layout, parking availability, zoning laws and foot traffic. Is there room for a patio or potential for future expansion? Is the building equipped with necessary utilities for a restaurant, like proper ventilation and gas?
Negotiate for a favorable lease
Everything in a commercial lease is usually negotiable. Consider hiring a real estate lawyer who understands the nuances of commercial leases. He or she can negotiate terms that protect your interests, such as a rent abatement period, favorable renewal options, or limits on your triple net obligations.
Remember, a lease is more than just a contract; it’s the foundation of your restaurant’s future. Take the time to understand it, consult with professionals and make informed decisions that will better enable your business to thrive.
