Highly Skilled New Jersey Lawyer Committed
To Providing You With Optimal Results

Passaic County Court House Annnex, Historic Court House and Passaic County Superior

Do you know these commercial real estate red flags?

On Behalf of | Oct 12, 2021 | Real Estate Law

You think you found the ideal space for your small business and feel ready to sign the lease. Before agreeing to all the document’s terms, ensure they protect your interests.

Forbes explores warning signs associated with commercial real estate contracts. Learn these red flags to keep your business in the clear.

Unable to return the space

While reading over the lease, see whether you have the option to return the space during the initial five years. In case you like the space, you may also want the option to make the first offer for available adjacent space.

Overly positive business projections

While you hope your business does well, do not let unrealistic projections sway you. Even if you qualify for special funding or stimulus support, that extra help may not last long.

Confusing tenant/landlord obligations

The real estate lease should include clear shared and separate tenant/landlord responsibilities. For instance, which party bears responsibility for following the latest health and safety guidelines? Leaving such obligations unclear could cause increased and unnecessary liability.

Unreasonable force majeure clauses

Take your time while reading the agreement’s force majeure clauses. This section absolves you of your performance responsibilities when specific situations outside of your control arise. Whatever the force majeure clauses, you must feel comfortable with them.

Unequal provisions

You deserve to feel good about agreeing to all other clauses on the lease. If you notice anything that favors the landlord over you, you and the other party may not have a mutually beneficial agreement.

Trust your gut when looking over your commercial real estate lease. Your instincts could alert you to a red flag that might undermine your company’s success.