Commercial Real Estate Listings Key Terms
Knowledge of commercial real estate terminology gets you the space you needFamiliarity of commercial real estate terminology is beneficial in a variety of ways. For starters, it allows individuals to narrow online commercial property listings to fit the particular needs of your business. In addition, familiarity of commercial real estate key terms gives you an understanding of the “fine print,” such as base or contract rent, common area maintenance, cost of occupancy and certificate of occupancy that comes along with signing a lease.
ZoningThe zoning of a property regulates the uses - such as commercial, industrial or manufacturing - that can occur on the land. Zoning is a determining factor in whether a business can locate at a specific location.
Base or contract rentThe base rent, sometimes referred to as the contract rent, is the total amount of money one must pay as part of the lease agreement.
Common area maintenance auditsWhen renting commercial office space, the tenant may be required to pay common area maintenance fees that go toward maintenance of the building and parking lots, utilities, landscaping and snow removal. If paying a common area maintenance fee, having an audit performed to ensures that you are paying a fair rate.
Tenant improvementsTenant improvements refer to the remodeling of a building or physical improvements to the property that are necessary to meet the requirements of the tenants. Tenant improvements can be the financial responsibility of the tenant, landlord or both parties.
Certificate of occupancyThe certificate of occupancy ensures that a building complies with all necessary codes, like those related to electrical, fire and plumbing, and may safely house tenants. Before signing any lease agreement, it is important to verify that the building has a certificate of occupancy issued by the local government.
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