Every business needs premises. Before you even think about whether to buy or rent premises why not consider working from home? This can be a great option if you’re just starting out on your entrepreneurial journey or work for yourself. If you do need a stand-alone business facility the next step is to work out whether you should buy or rent business premises. This article will take you through the options from a legal perspective.
1. Buying
Buying your business premises can work well in certain circumstances. If your business requires premises with a very specific set up, you have a good cash reserve and you don’t need that cash to grow your business, it can be a good idea to buy your premises. For the majority of businesses, particular start-ups, buying your premises is not a good move. You will tie up desperately needed cash, impeding your growth. You will have to take care of the maintenance of the premises, wasting precious time, and most importantly, there is obviously no guarantee that the property will appreciate in value. If you’re a great graphic designer, there’s no reason at all to think you have skills in appraising and valuing commercial property – why not stick to what you’re best at? If you do decide to purchase your business premises, you will need to get a lawyer involved. Each business premises sale and purchase is different; and experienced lawyer can guide you through the process and ensure you miss the most important pitfalls!
2. Renting
If you’ve decided not to buy a commercial property, the next step to consider is whether renting is the right option for you. By renting a property you give yourself the flexibility to move locations as your business grows (or shrinks!), you also ensure that you have certainty as to how long your business can stay in a given location. As a renter, you do benefit from various renters rights, which ensure you can’t just be kicked out of your business premises on a whim. For most businesses renting is a great option.
The documentation you’ll need to enter into a rental agreement for business premises is a commercial lease. Commercial leases are more standard than business premise sale and purchase agreements, but it’s still a good idea to get a lawyer involved. LegalVision provides a fixed fee drafting and review of commercial leasing documents, which can be a great option!
3. Licence or Co-Share
Finally, if you’re an early stage start-up and can working in a shared office or co-working environment, this can be a great option. Generally you will only need to sign a simple one or two page licence agreement, which allows either yourself (or your company) or the landlord, to terminate the agreement with one month’s notice. It’s a flexible way to get access to office space, allowing you to move quickly if things change!
Conclusion
Whether you decide to buy or rent business premises, LegalVision can help you with both documentation and advice. Choose the right small business attorney to give you advice on buying or renting a business premises.
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