For investors of commercial real estate, it is important to find
the right kind of tenant who will be able to make timely payments on a
consistent basis and for a long period of time. This helps to keep a steady
cash flow for the investor while decreasing the number of vacancies of a
particular property. It is important to
consider a number
of factors that are involved in creating the lease terms and agreement..
A lease is essentially an agreement that sets out the parameters
and guidelines of a business relationship. A proper lease will serve to benefit
both parties, but the true test of a good lease is when trouble arises. If the
lease was not created correctly, a small problem can easily snowball into a
larger one. For those tenants who simply sign whatever lease is handed to them,
they may not realize that the lease they are signing works to benefit the
property owner. When an issue arises, the tenant may not like what they see in
the lease. On the other hand, an experienced tenant may wish to make changes to
the lease the will not benefit the property owner at all.
When creating a
lease, it is important for the property owner and the potential tenant to be as
diplomatic as possible in negotiations. Once both parties are able to
understand where the other side is coming from, a true understanding can be
reached. This balanced perspective can help to root out any potential problems
down the road. LaeRoc Income Fund is based on the West Coast.