Consult an Attorney about Your Business Location

by Ben Bhandhusavee

1. To Review a Lease. Perhaps you, or maybe your tenant broker, have been able to negotiate with the landlord over provisions you want included in the lease. You think the draft of the lease accurately and adequately represents your interests. The landlord wants you to sign the lease. What should you do? Consult an attorney. Almost every landlord is going to understand this (after all, they do it themselves).  Always have an attorney review your lease prior to signing--especially where the lease has been negotiated and/or drafted by the landlord's agent who, supposedly, is also representing you as a "dual-agent". Think an agent who was hired by (and will be receiving a healthy commission from) the landlord will represent you as fairly and faithfully as a dedicated tenant agent or independent attorney? Think again.

2. To Review A Purchase Agreement. You've decided to purchase a building. This is the first time you've purchased commercial property. The owner has given you a purchase contract to sign. What should you do? Consult an attorney. An attorney should be consulted well before a purchase contract is signed, or even drafted.  We are always grateful when clients approach us at or shortly after a Letter of Intent has been entered into.  Keep in mind that, once you sign something (e.g., a purchase contract), unless the other party is very kind and generous, there's usually very little an attorney can do to change what you signed.  An attorney can not only help make certain that the purchase agreement actually contains the agreed-upon deal, but also maximize your due diligence period by identifying potential issues and concerns regarding the property before it's too late, not to mention crafting the necessary "out" clauses which will give you an exit strategy (and a way to get any earnest money back) out of the deal.

3. To Draft Critical Lease Clauses. You've decided on the location and discussed with the landlord certain provisions that you want included in the lease. These provisions are very important to you. The landlord has tentatively agreed to add these provisions to the lease. The landlord has suggested that you write down what you want and he will have his attorney incorporate these provisions into the lease. You've never written anything like this before. You want to make sure that your needs are met and that there is no confusion over the meaning of these provisions. What should you do? Consult an attorney. The attorney can draft these clauses for you. The attorney can make sure that your wants and needs are met and that there is no confusion over the meaning of these provisions.  Remember: confusion over the meaning of one or more key provisions can eventually lead to disagreement and costly litigation. Just as with the old saying, "An ounce of prevention equals a ton of cure", spending the money up front to discuss and resolve these issues and craft them properly in the final version of the lease, will save you much more money in the long run.

4. To Negotiate A Lease. The location and facility are perfect for your business. You've told the landlord that you want this property. In fact, you've gone on and on about how perfect this location is for your business. The landlord hands you a "boiler plate" lease and tells you that the terms are non-negotiable. You try negotiating with the landlord but he won't budge. What should you do? Consult an attorney. Like any other contract, the terms of a lease are negotiable. You may be too close to the situation, however, to negotiate a lease that best serves your interests. An attorney can negotiate on your behalf.

5. To Research Zoning Laws. You've found the perfect spot for your business but you're not sure whether the area is zoned for your type business. The landlord doesn't think there are any zoning restrictions but cannot give you any assurances. What should you do? Consult an attorney. The attorney can research the zoning laws for you. You will then be sure that your business can locate in the area without running afoul of any zoning laws.

6. To Review a Real Estate Agent's "Form" Contract. You've spent several months searching for a location for your business. You've found a few sites that might work but would like to broaden your search. You think that a commercial real estate agent may have access to additional properties. You contact an agency and meet with the agent. You decide to sign on with the agency. The agent then hands you an exclusive representation agreement. You read the agreement but aren't sure of the restrictions contained in it. What should you do? Consult an attorney.  I can't tell you how many supposedly "sophisticated" or "experienced" clients I've had come to me that signed off on listing agreement or buyer-representation agreements that contained provisions that were borderline unconscionable.  An attorney will explain an agreement to you in an independent fashion before you sign it.  he or she can also make sure that any properties that you found on your own prior to engaging the services of the commercial real estate agency are not subject to the restrictions in the agreement.

If you have a current or anticipated legal matter and would like to schedule a consultation, please click here or call our office at (602) 678-2970.  

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