Lease Negotiations Suck

In moving back and forth for several internships during college and then my job after college, I’ve lived in quite a few different places from anywhere from three months to a year. In doing so, I’ve looked at a lot of apartments and become accustomed to the relatively pain-free process of leasing an apartment. I always figured leasing business space would be the same. I was wrong.

Following our debacle a few months ago, we were pretty certain we found a great place for us a few weeks ago. It’s a short commute, it’s a brand new facility (meaning we have control over the layout), and it had a decent amount of space to grow in to. Then slowly but surely it began to fall apart. They would only sign a 5-year lease (five years is A LONG TIME for a young and ever-changing company like ours….we could have 30 employees in 5 years or it could still be just the four of us), and then the lease they sent over seemed to be a bit over the top. We forwarded it over to our lawyer who specializes in real estate, and hoped he’d tell us it was a good lease. If that was the case, we probably would have attempted to work them down to a 3-year lease and try to get a few other small concessions and if all things went well we could have moved in on 2/1.

Not so much. He came back with NINETEEN points of contention on top of the few that we came up with. And they weren’t just minor things. I’m quoting from his email here:

  • “This is burdensome and unnecessary”
  • “This particular section of the lease sucks for you and there are a lot of hidden costs here”
  • “This is not reasonable and is too suggestive”
  • “I think paragraph 5 under Section Nineteen is bull shit and definitely not standard”
  • “DEFINITELY NOT. The last paragraph under Section Twenty is OUT. I have never seen it done this way.”

That was enough for us to bail. We’re not going to sign a lease without those concessions, and there’s about a 0% chance they’ll concede on over 20 points in a 10 page lease. It’s not worth wasting our time.

Maybe I’m reaching here, but when you get a lease that sucks THAT MUCH, you have to wonder if they were trying to take advantage of us. This is an established property company in Albany that we were dealing with. They own a lot of commercial real estate in this area, and you’d think their other tenants would have a lawyer review a lease. They’ve been around for a long time and I wonder if they’d try to slip a lease like that by a large corporation. Do they see four 25 year old guys and think “these guys have no clue what they’re doing”? Regardless of whether they are ageist scumbags or just equal-opportunity scumbags, we’re out and we’re happy we took a hard stance.

We’re now looking at cheaper, shorter-term alternatives. After getting together for a few hours last night and calling some of our friends/family/business contacts, we already have a handful of opportunities. If we can trim our rent costs from ~$3k/month to ~$1k/month we can put that extra money away to build our own facility in 1-2 years when we learn a little more about how our company is going to shake out.

Even though stuff like this pisses me off, it always seems to work out for the best.

1 comment on Lease Negotiations Suck

  1. […] feel great!  We’ve been looking for a place since back in August,  and after having a few places fall through we finally found the perfect location for […]

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