Whether you are a commercial landlord or a tenant in Toronto, negotiating lease terms is one of the most impactful business decisions you can make. If a lease renewal is coming up, you will face both business opportunities and potentially new business challenges. This is where a business lawyer in Toronto could help.
To get the best possible terms from a lease renewal and ensure a long-term agreement that works for all parties, having a lawyer go over the agreement process with you is essential. But first, find out the key factors to keep in mind when approaching a commercial lease renewal.
LEASE RENEWAL TIPS FOR LANDLORDS
WORK WITH A PROFESSIONAL
If you are about to enter lease renewal negotiations with a tenant, it is essential that you hire a lawyer who will understand the types of clauses to create. They will ensure that you conduct the renewal process in a way that is compliant with Canadian laws on commercial leasing, and they will ensure that the contract you offer is airtight and delivers the results you want.
GIVE PLENTY OF ADVANCE NOTICE
The previous lease will stipulate how much notice you should give to a tenant when the lease is due to expire and the renewal period will begin. This can be as little as two weeks or as long as one year and may also be determined on a legal basis. Always give your tenant plenty of notice if you want to avoid a lawsuit.
CONSIDER THE COMMERCIAL RENTAL MARKET
Your commercial property is your investment and your nest egg. When a lease renewal is coming up, consider the local rental market to see if there is room for you to increase the price of the lease. Remember to look at the previous lease agreement with a lawyer, as this should stipulate the maximum ceiling that is permitted for the lease raises.
APPROACH NEGOTIATIONS REASONABLY
Finally, remember to approach lease renewal negotiations with an open heart and mind. Do not think that a tenant is simply pushing their luck and listen if they wish to discuss rent reductions or upgrades. Replacing a commercial tenant is a very time-consuming and expensive process, so you should be willing to listen to your current tenants if you want to keep them on-site and paying you.
CONSIDER THE CONDITION OF THE PROPERTY
If the property that the lease renewal concerns in poor condition, you will have less wiggle room to raise prices and renegotiate lease terms. That being said, just because a tenant requests that you pay for upgrades does not necessarily mean that those upgrades are necessary. Arrange an inspection prior to the lease renewal to get a good idea of what shape the property is in, as this could be your leverage.
GET HELP FROM OUR LEGAL TEAM
If you need a business lawyer in Toronto to help you negotiate an attractive and compliant lease renewal that delivers the results you want, you have come to the right place. To get a quote and find out more about what our business lawyers can offer you, do not hesitate to get in touch with our friendly Toronto-based team today.