How to Lease Space for Operating Retail Shops and Outlets

Finding the right place can mean the difference between success and failure.

Building a place to open a retail or outlet business can be costly. Even if you have the financial backing to do it, it is a long complicated process with contractors, government permits, zoning issues and other things that newly developed areas often deal with. A less expensive solution may be to lease space that is already available. Leasing space can cut your startup costs dramatically as long as you enter the rental arena with due diligence and professional caution.

Instructions

1. Find the location you would like to rent for your retail and outlets. Be sure it is somewhere that will have heavy customer traffic. Take note of similar businesses in the area. If they are close enough to prove it is a good area for retail but far enough away to not be a threat to your business, it is probably a good location.

2. Request free rent for a specific time period. Landlords sometimes do this rather than reduce their price per foot. In addition, if the area is newly developed it will help the landlord to have businesses in the building. Giving you a few months to a year of free rent helps the area look like it is booming. Be sure the agreement for a period of free rent is clearly spelled out in your lease, so if a new owner comes along you have proof of the agreement.

3. Put together a list of improvements of changes you want made to the space before you sign the lease. It can be costly to prepare a space for a specific type of business. Many times a landlord will be willing to foot the bill if you are willing to sign a relatively long-term lease.

4. Make sure there is a sublease ability built into the lease. If you decide to expand, or this location turns out not to be a good fit for your retail and outlet shops, you want the ability to sublet it to a different type of business so it is a win-win for all parties involved.

5. Insist on a noncompete clause in the lease. This prohibits the owner from leasing nearby spaces to businesses that are too similar to yours.

6. Hire an attorney who specializes in retail and outlet properties and ask him to look the lease over, request needed adjustments and attend the lease signing with you so he can address any last-minute concerns.

Tips & Warnings

• Using a real-estate agent who specializes in commercial spaces can save you time and money.

References

• MSN Business on Main