How To Get The Best Rental Value For Your Commercial Property

Are you worried about whether you are getting the best value for your commercial property? Knowing the appropriate rental amount is important for receiving the best returns. 

In Australia, commercial leases are influenced by property regulations and are identical throughout the country. The commercial lease has certain specific conditions, and lease requirements vary largely based on the purpose for which space is rented out.

Understanding the basics of landlord tenant commercial lease agreement will help you get a good deal from renting out your commercial property. Here are some considerations to mull over:

Commercial Lease Agreement

Commercial lease conditions are linked to a wide array of areas. The conditions differ from one lease to another. However, some common conditions when you draft commercial lease agreement can specify

•           The business type that will be permissible in the premises
•       Operating times
•           Safety requirements
•       Parking arrangements and more

If you are not careful when you draft commercial lease agreement terms, you may end up charging too high. This carries the risk of your property not being rented. Or you may charge too low, resulting in low ROI. Moreover, low returns can potentially reduce the value of your property.

Important Things a Tenant Looks for

For tenants, to end up with a profitable deal, they should have a proper leasing structure prior to signing the lease agreement or expression of interest. More often the banker guarantee amount is very high but necessary.

As a landlord, you should ensure the lessee produces the guarantee. So, if the lessee walks off without paying the rent, you can make it up with the guarantee.

Ensuring the rental space is in good condition is also a critical requirement you have to look into while drafting the landlord commercial lease agreement.

To sweeten a rental deal, you can also consider offering incentives like cash aid for fit-outs or rent-free duration. Research the property market and decide on the right incentive that is tax effective for the tenant and works in your favour too.

Fix the Rent Based on What Your Competitors Demand

Consider the number of vacant spaces in the commercial rental field in your locality and other factors that affect the rent before you fix a fair rental rate.

This is where an online search can help you. You can also get help from real estate agents or even better - the landlords in your locality to get a clear picture of the rental values.

To maximize your returns, it is imperative that you draw up a landlord commercial lease agreement that gives you the best returns. And remember that commercial rent is calculated on per square metre basis, unlike residential spaces. This calculation is influenced by various factors including

•          The location
•          Age or quality of the rental space
•          Services offered
•          Neighbouring tenants
•          Size of the property

When you are well aware of the basics regarding the value of your rental property as against the prevailing market rates, you can secure a profitable rental rate.

Drafting a landlord tenant commercial lease agreement that provides benefits for both parties involved is easier when you understand the basics. A prime location, quality property, and amenities can fetch you a higher rental value. If you take the effort to review recent lease agreements and transactions in your locality, you will be able to quote a fair rental rate and benefit from it.