Many small businesses start out with just an owner working out of his or her home. However, as time goes on and the company grows, working out of one’s home is no longer a feasible option. You may have recently found yourself ready to expand your business and start working from a commercial space.
Like with any type of real estate, it can take time and effort to find the right commercial space for your business. As a result, you certainly want to be prepared to make an offer and know what you want when you come across the perfect space. In particular, you may want to consider asking for seller concessions.
Help you save money
Generally speaking, seller concessions can help you save money upfront when it comes time to close on your commercial real estate deal. Some concessions you may want to consider requesting include the following:
- The seller paying some or all of the closing costs
- Reducing or waiving fees
- Including furniture or equipment
- Having the seller make repairs or improvements before closing
- Obtaining a move-in allowance
You may have other particular concessions you want to request, depending on the specific space and your specific circumstances. By making these requests, you could give yourself the chance to reduce the amount of money coming from your pocket during what will be a major purchase for your company. However, it is important to remember that it may take some negotiating before the deal is final.
Seller can agree or disagree
It is important to remember that the seller has no obligation to accept your requested concessions. If the seller believes you are asking for too much, he or she could simply reject your offer outright and go a different way. On the other hand, the seller may provide a counteroffer in which he or she requests a higher purchase offer or agrees to certain concessions and not others. It is common for purchase offers to increase when asking for concessions in hopes of making the offer more appealing.
Know what you are getting into
Because this is your first commercial real estate purchase, you certainly do not want to be taken advantage of during the process. Fortunately, you can have an advocate on your side who understands business and real estate laws in California. An experienced attorney can go over your purchase agreement, help you negotiate your concessions and handle other matters associated with your transaction.
