How to Investigate Your Prospective Commercial Landlord
When it comes to renting commercial space, landlords are always investigating prospective tenants to help ensure there will be no unpleasant surprises. And nothing says tenants can’t do the same before signing a lease and moving in.
Landlord Credit Check
A building owner’s creditworthiness is extremely important, especially in an economy where major real estate holders may be getting hit hard. Tenants should know if building owners are restructuring a loan they cannot repay or are otherwise facing any financial issues. Running a credit check is not a bad idea, especially in larger deals where a lot is at stake.
Credit reporting agencies can provide a wealth of information, such as if a person has ever been:
- Late or delinquent paying off loans or bills
- Convicted of a crime
- Evicted, with info availability varying from state to state
- Involved in lawsuits
- Filing for bankruptcy
Even if your landlord is the nicest fellow when he’s on the walk-through, he’s not necessarily the person you’ll be dealing with on a daily basis. Find out who you’ll be dealing with on a day-to-day basis so you can determine if he or she is just as nice.
Another wise move is to ask your prospective landlord for references of current and past tenants, and then follow through by actually contacting them. Questions you can ask references include:
- How quickly the landlord responded to unexpected issues or inquiries
- Biggest challenges tenants faced while renting a space in the building
- Any dilemmas or problems that cropped up, and how they were solved
- Ease of working with landlord and building manager in general
Your goal for contacting references is to look for any red flags that could indicate the move may not be the best one. You’ll also get a feel for what it’s like to work with your landlord and building staff in general.
Protecting your company is essential when moving into a new space, and checking out your prospective landlord is a good strategy to help you do so.