You pull into a strip mall nearby looking for the new gift shop you have read about. Your eyes scan the landscape of various storefronts. There is a dry cleaner, veterinarian, bakery, dentist and a sandwich shop. There it is – you see a new gift shop in an old space where there once was a clothing boutique.
What do all of these different businesses have in common? They all operate through a landlord-tenant relationship. Now you probably see “Retail Space for Lease” signs all over the place. We can confirm that Houston, Texas has a large amount of them, but what does it mean?
This is a lease which transfers the right of possession of property from the landlord, referred to as the lessor, to the tenant, referred to as the lessee. The lessor gives the lessee the right to use the space and/or property but still retains ownership. In doing so, the lessor receives rent as compensation from the lessee.
What do all of these different businesses have in common? They all operate through a landlord-tenant relationship. This is a lease which transfers the right of possession of property from the landlord, referred to as the lessor, to the tenant, referred to as the lessee. The lessor gives the lessee the right to use the space and/or property but still retains ownership. In doing so, the lessor receives rent as compensation from the lessee.
So what constitutes a valid lease? There are typically five components needed:
- The names of both the lessor and lessee
- The description of the property and space to be rented
- The length or term of the lease along with any option for extending or expanding
- The amount of the rent with increases or decreases clearly identified
- The date in which the rent is due each month
Once these elements are included, the lease can be constructed to suit both parties. Many times revisions through negotiations are required by both sides in order to accommodate the tenant and satisfy the landlord as well. This is where a well-versed commercial real estate broker provides value, by ensuring the client has a lease that will commensurate with the commercial real estate market and the best interest of the client in mind.
A good relationship between landlord and tenant usually occurs when both parties have their obligations or “covenants” spelled out clearly in the lease. It is important to employ the services of a commercial real estate attorney to ensure the document is fair and equitable for both parties. Being attentive and taking action to the needs of the tenant builds trust and in turn, can maintain a relationship with a lessee who treats the rental property as if it was their own.
The J. Beard Real Estate Company has an expert team in providing services related to commercial properties for lease. If you have a business in need of the right location or are a property owner looking for the perfect tenant, The J. Beard Real Estate Company is the leader in bringing business and property owners together and will work hard to assure the landlord-tenant relationship you are seeking will be a successful one. Tap into our insight, leadership, and expertise by calling 281-367-2220 or visit our website at www.jbeardcompany.com to view our current listings.
