A lease is a legally binding contract that gives you certain rights to a property for a set term. You should never sign a lease without understanding all of its terms and conditions. If you don't understand what you are agreeing to, you could experience serious financial and legal problems.
We recommend you ask your solicitor to explain each clause of the lease to you. Your solicitor can also help you to negotiate lease terms to suit your business.
Because a lease is a legally binding contract, it's important to thoroughly investigate the premises and lease document before you sign.
Take your time
Give yourself plenty of time to research suitable locations, investigate potential leases and ask questions.
After finding the ideal location, you may want, or the landlord may encourage you, to sign the lease immediately to secure your right to the premises. But make sure you understand all terms and conditions before you sign, as it may be difficult to get out of a lease if you change your mind. You shouldn't feel pressured into signing a lease before you are ready.
Get help from experts
Ask the experts for advice to help you avoid any legal or financial problems associated with the lease.
Your solicitor can explain what each clause of the lease means for your business, give you legal advice, draft new clauses and negotiate terms and conditions to suit you.
Your financial adviser or accountant can help you work out your expected cashflow so you know how much you can afford to spend leasing premises.
Also contact your insurance company and discuss the clauses referring to insurance so you fully understand what is covered by the lease.
Learn more about working with business advisers.
Speak to your local council
Councils in Queensland regulate business activities. Ask your local council if your business can operate in your desired location. Also consider the council's development plans for the area you are considering.
Choose between multiple locations
If you have a shortlist of locations, examining the lease documents will help you compare the premises. If your business needs a high traffic flow of potential clients past your door, you can expect to pay a higher rent. Lower rents may indicate the value of the property (which is often based on the volume of passing traffic) is low.
© The State of Queensland 2016
The content was first published on www.business.qld.gov.au
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