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Renting out commercial property:

Lucrative in the long term if you do everything right.

In a good location and with a solvent tenant who wants to stay for a long time, it can be lucrative to rent out a commercial property. On the other hand, there are also attractive new buildings or properties with less favorable transport connections that remain vacant for a long time and cause ongoing costs. Not only the search for a suitable tenant is often more complicated in commercial leasing than in private residential leasing. Also the negotiation of the commercial lease, the agreements on rent and term as well as some other conditions are not subject to the clearly defined guidelines of the residential lease law.

Avoid changes of tenant

Depending on the type of your commercial property, leasing usually requires not inconsiderable investments in conversion measures in order to meet the very individual requirements of interested parties. New technical equipment for the hall or new cabling and lightweight walls for office space are just a few examples. As a landlord, you will therefore have a fundamental interest in concluding a lease that is as stable and long-lasting as possible. Qualified commercial real estate agents from RE/MAX have sufficient know-how to be able to rent out your commercial property profitably and to negotiate an acceptable cost absorption of the conversion measures.

RE/MAX-Tip: The extended new brokerage law on commission regulation does not apply to commercial real estate. You can charge your future tenant the broker’s commission.

Rent and rent increase:

The contractual agreements apply.

You are free to choose the amount of rent for your commercial property. The classic tenant protection of the residential real estate tenancy law does not apply. Of course, you should follow the customs of direct competition, otherwise you will not find a tenant in time. However, you must explicitly stipulate future rent increases in advance in the lease agreement. For example, by agreeing on a graduated rent, specifying a rent increase after modernization or agreeing on a turnover rent, where the rent payments are based on your tenant’s turnover. Commercial lease law allows a lot — only condition: It must be in writing. Therefore, take advantage of our professional help in drafting the contract.

Advantage and risk:

Rent commercial property with sales tax.

If it is profitable for you, you may include sales tax on the rent when renting out your commercial space. This has a positive effect on all expenses for the property, especially for larger investments, from which you can then deduct input tax. But beware: You may only rent inclusive of sales tax to those tenants who themselves provide services that are subject to sales tax. This does not apply, for example, to banks, insurance companies, doctors or liberal professions.

Commercial lease:

Never without expert assistance.

The commercial lease is a small “science” in itself. On the one hand, it is freely negotiable, and on the other hand, it is invalid if it does not contain the following information: Location and size of the commercial property, purpose and duration of the rent, and the amount of rent. It is advisable to specifically formulate further details such as precise rights of use and protection against competition, operating cost regulations as well as notice periods and the like. Unlike rental agreements for residential properties, which only permit a fixed term in exceptional cases, the opposite is true for commercial leases: they are usually concluded for fixed terms, thus giving both parties planning security. Termination is only possible for “good cause” (rent arrears, destruction of the leased property). Termination for personal use is also excluded.

RE/MAX-Tip: Never sign a commercial lease that has not been previously reviewed by a knowledgeable expert.