How You Can Screen New Tenants
Like it or not tenants in commercial and industrial buildings need to be screened in a number of ways before a lease is finalised. Failure to do so can see issues with occupancy and rent over the term of the lease.
Some landlords are too eager to close on a lease deal and then think about the deeper process of tenant placement later.
Tenants move premises and relocate for all types of reasons and it is wise to understand the real reasons behind every tenant placement.
Here are some of the most common:
- Lease expiry elsewhere
- Business liquidity
- Needing more or less space to run the business
- Difficulty with other landlords
- Wanting to secure a lease rent free period to reduce cash flow and occupancy costs
- Requiring better property improvements
- Conflicting tenant mix
- Warehousing or showroom needs
- Aligning rent and occupancy charges to market
- Change of business client base and sales systems
- Staff and customer pressures on property use
- Difficulties with other landlords, tenants, or agents
Without asking the right questions a new landlord considering a tenant could land in some difficult problems over time.
So what should be screened as part of a tenant selection process in a commercial or industrial property?
Try some of these:
- What is the identity of the business?
- Where have you traded before?
- Why are you moving?
- What is your budget for rent and outgoings?
- What is the Corporate structure?
- Where is the head office?
- Who is in charge?
- Can you give credit references?
- What is the use that you will put the property to?
- What is your business plan in this new location?
- Who was your previous landlord or agent?
Good questions like these will help any landlord carefully consider a new tenant for potentially filling a vacancy for the long term. Get the real facts behind every lease negotiation and tenant change.
Should you wish to discuss your tenancy, or any industrial property, issues please contractor office on 07 3331 5444 or at raywhitecommercialmilton.com
* all information contained in this post is indicative only.