Every year companies do performance reviews, budgeting reviews, sales plans, etc, however I've never heard of one doing an annual review of their commercial lease. Your commercial lease is one of your biggest financial and contractual obligations and it should not be overlooked or forgotten. Depending on your current size and future plans there are certain leases clauses that may have been pre-negotiated and if overlooked or any important dates are missed you could put your company in jeopardy.
After signing a commercial lease most tenants simply file away the contract and never look at them again. Then later on when something comes up they can never find the lease. Ideally you want to store the lease in a secure file that will be easy to find later. And every year you want to do a thorough review of your commercial lease so you don't forget important dates, deadlines, terms, & conditions.
Annual Commercial Lease Review Considerations
- Make sure you know your commercial lease expiration date. If not clear ask the landlord what expiration date they have on file and make note of that
- If you have a renewal option know how many months notice you must give and be sure to not miss that timeline. Typically tenants must give 6-12 months notice of their intent to renew.
- If you plan on relocating you want to make sure you give yourself plenty of time to find a new space and build it out before your existing leases expires
- Do you currently have enough space to meet your needs?
- What options do you have if you need to expand or downsize?
- What are landlord currently quoting for comparable commercial space as the one you occupy?
- If you have a ROFO or ROFR what are the terms and have you been offered them in the last year?
At the end of the day it's important that you have read your commercial lease contract and fully understand all the important dates, deadlines, terms, and conditions. Missing one or more of these could potentially disrupt your business. To be more proactive dig up your commercial lease each year and review it from top to bottom to make sure you have not missed any important details.
If you have any questions about your existing lease or need to find and rent Austin office space feel free to contact us at 512-861-0525