You’ve made the decision – your business needs a commercial space. Whether you’re a startup looking for your first office, a growing company that’s outgrown your current location, or an established business ready to expand, deciding to lease is a major milestone. What comes next, though, is where a lot of business owners get overwhelmed. Commercial leases are complex, the market moves fast, and making the wrong move can lock you into a costly situation for years. Here are 10 steps to take right now to find the right space and protect your business every step of the way.
1. Get Clear on What Your Business Actually Needs
Before you look at a single listing, sit down and define exactly what you need in a commercial space. Think about square footage, number of private offices or open work areas, storage requirements, parking, loading access, and any special equipment or utility needs your business has. Be honest about both your current situation and where you expect to be in three to five years. A space that fits perfectly today but leaves no room for growth can become a real problem fast. The clearer your picture of what you need, the easier every other step in this process becomes.
2. Set a Realistic Budget Before You Start Looking
Commercial leases involve more than just monthly rent. Before you start touring spaces, build a complete budget that accounts for base rent, common area maintenance fees, utilities, insurance, property taxes if applicable, build-out costs, moving expenses, and a cushion for unexpected costs. A general rule of thumb is to spend no more than ten to fifteen percent of your gross revenue on rent. Knowing your real numbers before you start looking keeps you from falling in love with a space you can’t actually afford, and it gives you a clear ceiling when it comes time to negotiate.
3. Hire a Commercial Real Estate Broker
This is one of the most important decisions you’ll make in this process, and it costs you nothing as a tenant – the landlord pays the broker’s commission. A commercial real estate broker who knows your local market gives you access to spaces that aren’t publicly listed, helps you understand what fair market rates look like, and guides you through every step of the process. Without one, you’re negotiating against a landlord who almost certainly has more experience than you do. With one, you have an expert in your corner who’s worked dozens of deals just like yours and knows exactly what to ask for.
4. Research Locations Carefully
Location is one of the most critical factors in a commercial lease decision, and it deserves serious research before you commit. Consider proximity to your customers, how easy it is for employees to commute, access to major roads and highways, nearby parking, and the overall feel of the area. Think about what’s around the building – are there restaurants, services, or amenities that matter to your team or clients? Visit your top locations at different times of day, including during rush hour and on weekends, to get a real feel for traffic patterns and activity levels. A great building in the wrong location can hurt your business.
5. Understand the Different Types of Commercial Leases
Not all commercial leases work the same way, and the type of lease you sign has a big impact on your total cost. In a gross lease, the landlord covers most operating expenses and you pay a flat rent. In a net lease, you pay base rent plus some or all of the operating costs like taxes, insurance, and maintenance. A triple net lease, often called an NNN lease, means you’re responsible for nearly all operating expenses on top of rent. Understanding the difference before you start comparing spaces helps you make an accurate apples-to-apples comparison and avoid surprises after you’ve already signed.
6. Tour Multiple Properties Before Making Any Decisions
Never commit to the first space you see. Tour at least three to five properties before you start narrowing your options, even if the first one feels perfect. Seeing multiple spaces gives you a much better sense of what’s available in your price range, what trade-offs are common in your market, and what kind of leverage you might have when it comes time to negotiate. Take notes and photos during every tour. Pay attention to the condition of the building, the quality of common areas, the responsiveness of the property manager, and whether existing tenants seem happy with the space.
7. Negotiate the Terms – Not Just the Rent
Many business owners focus entirely on the monthly rent number, but the lease terms surrounding it can matter just as much. Key items to negotiate include annual rent increases, tenant improvement allowances to help cover your build-out costs, free-rent periods at the start of the lease, lease length and renewal options, early termination rights, and who is responsible for maintenance and repairs. Don’t assume any of these terms are fixed. Landlords expect negotiation, especially in a competitive market, and a good commercial broker can often secure concessions that save you significantly more than the rent reduction you were focused on.
8. Read Every Word of the Lease Before You Sign
A commercial lease is a legally binding document that can tie your business to terms for five, ten, or even more years. Before you sign anything, read the entire lease carefully – not just the major sections but every clause, addendum, and exhibit. Pay close attention to the permitted use clause, which defines what activities you’re allowed to conduct in the space. Look at the default provisions, sublease rights, renewal options, and any restrictions on signage or modifications. Things that seem minor in the moment can create major headaches later. Never rely on verbal assurances from the landlord that aren’t written into the lease itself.
9. Have an Attorney Review the Lease
Even if you’ve read the lease thoroughly yourself, have a qualified attorney review it before you sign. Commercial leases are written by lawyers working on behalf of the landlord, and they’re designed to protect the landlord’s interests. An attorney who works with commercial tenants can spot problematic language, flag clauses that put you at unnecessary risk, and suggest modifications that better protect your business. The cost of a legal review is a small fraction of what a bad lease can cost you over its full term. This step is especially important for first-time commercial tenants who may not know what normal looks like.
10. Plan Your Move-In and Build-Out Before Day One
Signing the lease is not the finish line – it’s the starting gun. As soon as the lease is signed, start coordinating your move-in timeline, scheduling any tenant improvements or build-out work, arranging utility activation, setting up insurance, and notifying your clients, vendors, and team of the new address. If your lease includes a tenant improvement allowance, work with your landlord to understand the process for accessing those funds and get your contractor lined up early. The faster you can get your space ready and operational, the sooner your business can hit the ground running in its new home.
Ready to Lease Commercial Space in the Twin Cities? Summerhill Can Help.
Leasing commercial space is one of the biggest decisions your business will make, and having the right team in your corner makes all the difference. Summerhill Commercial Real Estate has been helping businesses throughout Minneapolis, St. Paul, and the surrounding metro find, negotiate, and secure the right commercial space for decades. Whether you’re looking for office, industrial, or retail space, our experienced brokers know the Twin Cities market inside and out and will guide you through every step of the process. Contact Summerhill Commercial today and take the first step toward a space that works as hard as your business does.