I am thinking about leasing retail space to use for my e-commerce company. It's very difficult to find warehouse space in my area less than 10000 s/f. I'm currently renting from a company that bought a large warehouse and subdivided it into smaller units. I'm paying $1800/month for 400s/f which I feel like is extremely high ($54/sf/year). On the plus side, the fee is all inclusive (internet, utilities, trash, taxes, etc.). I'm in NJ in a moderate COL area, not near NYC.
The unit that I'm looking at is 1200 s/f, and the cost is $21.50 (NNN - Rent is $16, CAM/insurance/taxes are $5.50). I exchanged preliminary emails with the broker, and that's been the extent of my contact. They mentioned that they typically do 5 year leases.
My warehouse space was the first lease I ever entered, so I don't have much experience with commercial real estate. I wanted to see if I could get some general advice on how to approach something like this. I originally thought that maybe I could get a broker to assist me, but I realized that they have no interest in a deal this small.
I don't know if there are specific questions I should ask, or if there are any potential issues I should consider. These are some of my general thoughts, and if anyone could help with any of them, I would be very appreciative!
The unit that I'm looking at is 1200 s/f, and the cost is $21.50 (NNN - Rent is $16, CAM/insurance/taxes are $5.50). I exchanged preliminary emails with the broker, and that's been the extent of my contact. They mentioned that they typically do 5 year leases.
My warehouse space was the first lease I ever entered, so I don't have much experience with commercial real estate. I wanted to see if I could get some general advice on how to approach something like this. I originally thought that maybe I could get a broker to assist me, but I realized that they have no interest in a deal this small.
I don't know if there are specific questions I should ask, or if there are any potential issues I should consider. These are some of my general thoughts, and if anyone could help with any of them, I would be very appreciative!
- Can I negotiate pricing at all? I'm assuming not, especially if I want a shorter term, but would I look foolish to ask?
- Is it likely that they would consider a 2 year term? It's not about me doubting my business...it has more to do with being able to move to a proper warehouse should the opportunity arise. That's my goal, but I'm not ready for that much space at this time.
- Are there likely to be additional costs beyond what the broker outlined? I know I'll have to pay internet, utilities, and various incidental expenses. I'm not sure if I'm missing anything else.
- I assume a personal guarantee is standard, and I'm okay with that.
- I don't need any type of special buildout. It would be nice to get access to the unit a week prior to commencement (so I can move inventory before my existing lease expires), though I have no idea if that is a reasonable or typical request.
- I plan to have an attorney review the lease prior to signing.