Considering a commercial property lease? Start here
Just like residential property, commercial property includes buildings of all shapes, sizes and categories. You will need to carefully consider the type of commercial premises that works for your business now, and also think ahead to the future. And if you’re used to renting in the residential market, there are a few important differences you’ll need to know about before you start your search.
Types of commercial property
With over eighteen hundred commercial properties in our real estate portfolio, Mileway’s commercial properties offer an extensive range of options across Europe. While no two commercial properties are the same, we can group properties into a few distinct categories that suit the types of businesses we work with. Local authorities generally categorise properties too, and you will need to check your region’s commercial property use classes to make sure that the property you are planning to let is legally considered suitable for the type of business you want to conduct there. If you’re planning to make any major changes to the property, you’ll need to check this with the property’s owner, too.
Storage and distribution centres
The great shift towards e-commerce in recent years has upped the demand for warehouses and distribution centres that help businesses keep goods flowing towards their customers. These properties can be anything from repurposed industrial buildings to expansive, state-of-the-art warehouses away from population centres. But increasingly, businesses see the need for strategic positions within or very close to cities. These equally diverse local storage and distribution centres make it possible for businesses to compete to provide fast or even same-day delivery turnarounds to their customers. Mileway has a large portfolio of commercial property close to population centres that are designed to help businesses fulfil this last mile.
Most storage and distribution centres are located next to main transportation routes. Some are built with specialist facilities to suit different business needs- for example, a food service business might require cold storage. You will likely work with your landlord to customize the interior space to your needs.
Industrial units include commercial buildings used for activities like manufacturing, product assembly, or often a mix of activities like a combined office and workshop space, or combined office and warehouse. Industrial units come in all shapes and sizes, from basic spaces that are not much bigger than a large garage to major industrial complexes with multiple loading bays for trucks and heavy customisation to accommodate heavy equipment. Industrial units can be available as standalone buildings dedicated to one business, or be multi-let properties where other businesses will be operating next to yours.
Retail units can be the familiar shops we see in commercial centres of cities, or more specialised workshops or trade units that blend into the industrial property space. You will usually be expected to fit out the interior or your retail space so that it fits your needs.
Office space can be used for administrative purposes or can be open to customers; for example, if you are selling financial or other services. They are available empty with basic fittings, fully furnished, or anywhere in between. When renting office space, you will need to consider accessibility for people and vehicles, whether the space can be made comfortable for people working there – is it temperature controlled and well lit? Are there bathrooms, kitchens, and nearby facilities? Does the property have a fast broadband connection?
You can rent an office spaces that is exclusive to your company, or work alongside other businesses. You should consider whether the space and privacy of an exclusive property is better for your business, or whether it would help you to connect and network with neighbours who are part of the same business ecosystem.
Other commercial properties
There are really as many forms of commercial property as there are types of business. Leisure facilities like gyms, hotels and restaurants are all commercial property. Dental surgeries, health centres and hospitals are commercial property. Open spaces of land like car parks and outdoor storage can be commercial property.
How to choose a commercial property
Location is likely to be your biggest concern when you are choosing a commercial property. If you plan to have customers on site, you’ll need to consider how easy it will be for them to find you. You may prefer to choose retail spaces in an established commercial area where there is more visibility for your business, and you’ll need to make sure visitors can easily reach you by car or public transport.
Even if you do not plan to have customers on site, you’ll need to ensure the location is convenient for you and for anyone who will be coming to work there, and that there is enough parking for staff and visitors arriving by car.
If you are planning to hire employees in the area, you will need to consider the local labour market. Are there sufficient people with the skills you need in the area, and can you hire them at the right cost? Are there amenities in the area that make it an attractive place to work, like shops, restaurants, entertainment venues or childcare facilities?
For storage and logistics property leases, you will want to consider strategic locations from which you can reach the largest proportion of your customers at the shortest distance. If you’re receiving and delivering goods by road, you will need to know how far those roads are from your property, their condition and any known issues with congestion that could impact delivery schedules.
Finding commercial properties in your area
Once you’ve settled on a location, you can begin to look for commercial properties to let in your area. On Mileway’s property finder website [LINK] you can search for available local properties by size, type or location to find the business premises that are ideal for you.
Commercial property leases
If you’ve rented a home before, you’re probably familiar with a residential property rental agreement. Commercial property leases can be a little different from residential properties. Commercial leases can sometimes lock your business in for multiple years, which can be helpful if you’re investing heavily in customizing the space, but less helpful if you value the flexibility to change locations or scale your premises up and down. While a monthly rent payment schedule is common in a residential property rental agreement, commercial properties often have a quarterly payment schedule. There may be more flexibility in the terms of the agreement than you’ll typically find when you’re leasing a residential property.
Commercial tenants are usually responsible for some additional property maintenance costs like fit-out and upkeep of the property itself, and maintenance of any shared facilities like communal parking areas, access roads and landscaping. You should examine these details carefully and be sure to include any costs for commercial tenants in your budget.
In all cases, you should check your property lease documents careful to make sure you understand and agree with the contents.
Insurance in commercial properties
Insurance in commercial and residential properties can also differ. Commercial tenants will be expected to insure the contents of their property including any stock or equipment, and protect their business and anyone who visits or works there. In most cases, the commercial building itself will be insured by the property owner. You should check your agreement carefully and speak to your real estate agent or property manager to make sure you’re clear on what’s covered.
Budgeting for your commercial property
Like a residential property, your commercial property costs will include rent, and most likely utilities, some service and property maintenance and insurance. It’s likely you’ll be responsible for your own interior furnishing and decoration, plus any equipment you’ll need on site.
Check with your local tax authority to find out whether you will need to pay commercial property taxes or business rates. In some areas, there may be tax relief available to help small businesses with these costs.
Renting commercial property from a trusted real estate partner
Mileway’s extensive commercial real estate portfolio makes it an excellent choice for both established businesses and new businesses renting a commercial property for the first time. In some cases, multiple units are available in the same estate or commercial building, which offers the possibility to expand the size of your premises as your business grows.
To get started, search for a commercial property using our property search.