Commercial real estate can be an excellent investment, however, a significant proportion of your profit margins can quickly be eaten away by costly agent property management fees—but there is a simple way to get around them.
Leasing commercial property privately is becoming an increasingly attractive option for commercial property owners. As more tenants turn to the internet to find a suitable property for their business, the need to engage a real estate agent to manage the leasing process is fast becoming redundant.
If you want to avoid forking out for costly agent fees but need to know more about how to rent out commercial property, we’ve got you covered. This simple guide will run you through what you need to know to list and lease your commercial property quickly and easily.
A step-by-step overview of how to rent out commercial property
‘For lease by owner’ websites like Property Now have made it very easy to advertise and lease or sell commercial property yourself.
Here’s a step-by-step overview of what you’ll need to do:
- Prepare the property for lease by addressing any maintenance issues and ensuring it’s clean and presentable.
- Determine a suitable rental price for the property in line with current market conditions.
- Find a conveyancer or solicitor to help you develop the lease agreement documentation.
- Develop your advertisement, including a detailed description of the property and quality photographs of the premises.
- Create your online property listing to advertise your property on various leading commercial property websites. It’s also worthwhile considering investing in any add-ons or extras that could increase exposure or make the property more appealing.
- Allow prospective tenants access to view the property.
- Select a suitable tenant to offer the property to and sign the commercial lease agreement.
Other things to consider when leasing out commercial property
Leasing commercial property yourself also comes with some additional responsibilities that a property manager would normally take care of.
Keeping the following points in mind when leasing your commercial property will make it easier to foster a good relationship with your tenant and ensure everything runs smoothly.
- Establish a good system for managing payments and bookkeeping.
- Develop a list of tenant policies and procedures relating to things such as payment expectations, parking arrangements, inspections and the handling of maintenance issues.
- Build a support team to help you with property maintenance, such as a builder or handyman, electrician, plumber and cleaner.
- Be selective about which tenant you choose and make sure you conduct reference checks.
- Be prepared for the tenant to want to make some changes to the fit-out of the premises.
- Arrange a routine inspection of the property at least once every 6 to 12 months.
- Ensure the building is adequately insured.
- Ensure any changes to rental rates are made in line with the rental agreement and current market conditions.
- Seek reliable legal advice before commencing any eviction processes.