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advice on commercial lease for residential/comm space

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DawnJoe

Junior Member
What is the name of your state? NY (Brooklyn)

I'm looking at signing a commercial lease on a ground floor apartment which includes a storefront, with intent to use the front space for seasonal/cottage retail.

The front/commercial area comprises about 1/3 of the total space. (the rear/residential is a 2BR)

The building itself is two-story, with 2 additional apartments on the upper floor.

The place was initially being considered as an apartment only, including the "store" space but with the shop windows impremanently covered (grate) - but the possibility inevitably arose of using the space to some advantage.

My brief research has revealed to me the massive extent to which the explicit conditions of a commercial lease can affect any dispute resolution, and in general dictate liabilities, and I have found some of the more insightful open discussion of this topic here on FA...

I would be renting directly from the building owner couple (they do not live in-building) and in initial discussion they have been open to whatever "reasonable" terms could be added to the lease to make it "more like a" residential lease in terms of renter's rights/responsibilities. They claim a tax advantage to renting the space commercially, but that the apartment itself is "to code" (though, as i understand, without a proper occupancy permit).

What would be some important things to specify in the contract to cover myself, and what would be conditions no "reasonable" amount of jargon would clear me of, in such a mixed use situation?

Any issues that would not be covered in a contract that I should be wary of? Any details that would determine specific conditions to define or be wary of?

Any help appreciated.
 
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You Are Guilty

Senior Member
I would be extremely wary of advising you how to do this yourself. Commercial leases are a "whole 'nuther animal" in which you are basically free to contract for any conditions you want. None of the traditional residential tenant protections will apply.

So at a minimum, I'd memorize everything in Article 7 of the Real Property Law (the Landlord-Tenant section). You'll also want to consider the the lack of a proper C/O - you don't want to worry about the city trying to remove you from the premises, or fining you for the illegal use due to pre-existing C/O problems. There's also the issues of utilities, taxes, sidewalk maintenance, vandalism/crime/security, lease termination/renewal provisions, interior maintenance, improvements/fixtures, other repairs... just to name a few.

Good luck.
 

lizjimbo

Member
Commercial Lease Pitfalls

I have had a few commercial leases in my time. Read them thoroughly, don't just sign. Our lease was 17 pages and a smart landlord knows full well how to bury all sorts of protection clauses in 17 pages. Things to search for are primarily what the landlord doesn't want to pay for if it breaks. Landlords will assume much less cost to repair on a commercial lease because of what they believe will be extrodinary use. So read it several times and negotiate out items you don't want. There are talking points and walking points. Make sure you know the difference and that the landlord knows you know.

Jim
 

Cvillecpm

Senior Member
Ask a commercial RE broker for the name of an attorney familiar with commercial leases and PAY THE MONEY to have the lease reviewed before signing it.
 

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