Sometimes it is what you do not know that can hurt you the most. This is true in any circumstance, but industrial leasing is only for the well informed. This business transaction is not as simple as renting for residential purposes. Regardless of the location of the business, some expenses may not be self evident. Boca Raton, FL, which has many properties built for manufacturing, will be used as the basis of this discussion.
Industrial leases are listed at the annual cost per square foot. For example, there are many buildings in Boca Raton listed at twelve dollars per square foot. If the building has ten thousand square feet, the annual cost would be one hundred twenty thousand dollars. Divide that by twelve to get your monthly cost of twelve thousand dollars. The size of the space to be leased will greatly impact the ultimate cost.
In most instances an industrial lease involves an entire building. If your business is renting only a portion of the building, read the lease carefully to determine if the deal will include any common area costs that will be added to the base cost. Common areas may include items such as reception areas, hallways and bathrooms that are used by all of the building occupants.
Review your lease carefully to determine the party responsible for paying utilities and property taxes. These expenses exist with any property. To fully understand the aggregate cost of leasing a property, you need to know if your business will be responsible for these added costs.
Typically the lessee will be required to purchase insurance as a condition of the lease. The property manager will request proof of coverage that identifies the amount of coverage and policy period. The property manager may also require proof annually from the the lessee that the policy is active and has not lapsed.
The term industrial usually means the leasing business manufactures some type of product. Manufacturing may also involve the storage of manufactured products and the goods used in production. In case of a fire, the property owner may suffer damages to the property, and the leasing business may suffer loss of inventory. Insurance is an absolute necessity for both parties.
Every geographic area has its own unique set of issues for the lessee. Florida is humid and can be subject to severe storms or even hurricanes. The building should be solid and built to withstand these threats. Security is another concern. The building should have a working alarm system that detects fire and the threat of burglary. There may also be the cost of paying for a security patrol service. Manufacturing areas can be subject to criminal activity, especially after business hours. The terms of the lease should identify the party responsible for paying these costs.
The cost of the lease and all the extraneous costs must be factored into the monthly expenses. Unseen costs can play havoc with your budget. It is up to the lessee to be fully informed regarding the extent of all expenses associated with leasing the building. Get all the facts to make an informed decision and ensure the future success of your manufacturing business.
Industrial leases are listed at the annual cost per square foot. For example, there are many buildings in Boca Raton listed at twelve dollars per square foot. If the building has ten thousand square feet, the annual cost would be one hundred twenty thousand dollars. Divide that by twelve to get your monthly cost of twelve thousand dollars. The size of the space to be leased will greatly impact the ultimate cost.
In most instances an industrial lease involves an entire building. If your business is renting only a portion of the building, read the lease carefully to determine if the deal will include any common area costs that will be added to the base cost. Common areas may include items such as reception areas, hallways and bathrooms that are used by all of the building occupants.
Review your lease carefully to determine the party responsible for paying utilities and property taxes. These expenses exist with any property. To fully understand the aggregate cost of leasing a property, you need to know if your business will be responsible for these added costs.
Typically the lessee will be required to purchase insurance as a condition of the lease. The property manager will request proof of coverage that identifies the amount of coverage and policy period. The property manager may also require proof annually from the the lessee that the policy is active and has not lapsed.
The term industrial usually means the leasing business manufactures some type of product. Manufacturing may also involve the storage of manufactured products and the goods used in production. In case of a fire, the property owner may suffer damages to the property, and the leasing business may suffer loss of inventory. Insurance is an absolute necessity for both parties.
Every geographic area has its own unique set of issues for the lessee. Florida is humid and can be subject to severe storms or even hurricanes. The building should be solid and built to withstand these threats. Security is another concern. The building should have a working alarm system that detects fire and the threat of burglary. There may also be the cost of paying for a security patrol service. Manufacturing areas can be subject to criminal activity, especially after business hours. The terms of the lease should identify the party responsible for paying these costs.
The cost of the lease and all the extraneous costs must be factored into the monthly expenses. Unseen costs can play havoc with your budget. It is up to the lessee to be fully informed regarding the extent of all expenses associated with leasing the building. Get all the facts to make an informed decision and ensure the future success of your manufacturing business.
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