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Guard Against Hidden Fees in An Office Lease! by Chris Hunter





Guard Against Hidden Fees in An Office Lease! by
Article Posted: 04/13/2012
Article Views: 140
Articles Written: 1103
Word Count: 669
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Guard Against Hidden Fees in An Office Lease!


 
Real Estate
Negotiating a commercial office lease to the point of finalization can be complicated. Bargaining may be involved to get the details arranged and a contract signed. Before rushing into any final agreements, businesses should be explicitly aware of what is or is not included in the payment. Inclusions and certain costs should be obvious, which can sometimes be hidden unless the right questions are asked.

Contract Review

Contracts are generally written to benefit the lessor, although that is not how it always appears. Commercial leasing is a subject with many gray areas, as contracts are sometimes written very ambiguously for this reason. It can leave a lessee responsible for items not specifically agreed upon or assumed to be included with any agreed fees. Money can be unnecessarily lost this way when hidden fees are uncovered. While some of these charges may just be a matter of simple ignorance on the part of the lessor, many times they are not; therefore, it is up to the lessee to look for such things and bring them out before contract signing.

Overcharges

Some of the usual places where companies end up being overcharged on their rental agreement include such things as utilities, maintenance, moving charges, and real estate taxes. The fact that these expenses do fluctuate makes it even harder to detect problems. Following are some of the potential areas:

  • Operating Expenses - Operating expenses can be passed on to a tenant in the lease cost; however, it should be clearly defined what constitutes an operating expense and be sure it isn't re-billed under another category. An example would be charging for general building maintenance while also charging for supplies, staff pay or specific items that would normally be considered maintenance. Specifying exactly what building maintenance includes, even payment for cleaning products, can make a big financial difference after a year.
  • Real Estate Taxes - Agreeing on a portion of real estate taxes to be paid is another area of confusion that must be carefully interpreted. Documentation as to how payments will be affected when taxes increase should be addressed in the contract.
  • Utilities - These costs present another area where determination of what constitutes such costs needs to be stated and the written contract must be reflective of this. Unless very careful, tenants could find themselves paying for electricity that was included as part of the operating expenses. It is also common for a lessor to quote an approximate cost rather than an actual cost that could be a lot more money. These are just some items that should be closely monitored in a lease contract by the tenant.
  • Moving Expenses - Another hidden fee when moving into an office building can be freight elevator use to get furniture and equipment in place. Any costs for such usage should be clearly spelled out in the contract to avoid unexpected fees. It is not uncommon to also face damage costs when moving out, even if some were originally there. If damages were pre-existing and not documented, a tenant could be forced to pay for whatever damage is discovered for use of the building.

    Professional Assistance

    To reduce the risk of hidden fees, a lawyer or real estate broker should be retained by a business to assist with the fine details in a lease contract, both those included and not included.

    Property owners want to recoup as much money as possible for expenses. An ambiguous contract will leave the door open for just such an occurrence as paying for unnecessary fees. A detailed, well-documented lease can end up saving a lessee a great deal of money over the course of a year, so hiring a contract lawyer or real estate expert to guard against hidden fees should be considered a top priority!

    C. Michael Hunter is an expert in commercial real estate and office space information. To find out more about Dallas Office Lease, go to the main website at: http://www.lcrgusa.com/.

    Related Articles - dallas, office, lease,

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