Renting out property as a business – details and nuances

Business, property and renting are the buzzwords for the entrepreneur in this area. Rental property has a number of advantages. As a rule, it is a reliable source of passive income and a good way to invest. When looking for suitable business premises, the best solution is to ask the experts for help.

Tips for leasing premises:

  • If you have a commercial property in a city centre or business centre that needs constant upkeep and is sitting idle, rent it out. This way you can make a monthly income.
  • Working through an intermediary. Choose your real estate agency wisely. Ask your friends and colleagues if they have any experience of working with reliable professionals. Pay attention to the presence of a good client base, the duration of the successful work on the market and the reputation – we have it all. You may also work without intermediaries.
  • The cost of payment. You can compare the approximate price range in your city or provide it to the realtor. The cost will be influenced by: traffic flow, the availability of good transport links nearby, the square footage and the general situation of the real estate market. If you need to rent out quickly and smoothly, lower the price a little.
  • Finding a tenant. If you are working through a realtor, he will take care of all the responsibilities for attracting a client, including his database and advertising campaign. In this case, you can assist him, for example, in the selection and placement of banners.
  • Preparing the necessary papers. If you go it alone, you will have to use professional services one way or another. Just contact a trustworthy lawyer or a highly specialised person in housing law. If you work through estate agents – they will take care of all the paperwork.
  • Lease documents. Once your broker has drawn up a tenancy agreement, your job is to check that all the right clauses are in place in the agreement. It should be mutual.

If you search for tenants on your own, you can use:

  • Advertisements in newspapers or magazines;
  • The experience of your friends, colleagues or acquaintances;
  • The database of real estate agencies;
  • The services and public databases on the internet.

So, there are several dangers in commercial leasing:

  • The property is being used for other purposes. Be sure to specify the purpose for which the premises or equipment is to be used when drawing up the agreement. You are entitled to terminate any agreement or impose a fine if the tenant, renting the property as an office, for example, set up a shop or a warehouse in it.
  • Property damage. In this case, the owner of the premises can request compensation for all damages (not only for repairs, but also the cost of the technical equipment itself).
  • Refusal to pay. Be sure to include the payment deadline and cost in the contract as well. If the tenant fails to pay, fines are due.

Leasing premises for commercial purposes is a win-win situation for both parties. It is important to draw up all the documents correctly and arrive at a mutually beneficial relationship. Don’t be afraid to contact professionals – they will help you to save time and not to miscalculate the choice of a reliable tenant.

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