If you have a commercial property available for lease, finding tenants should be your top priority. However, what you don’t want to do is settle for the first tenant who comes along in order to start bringing in income. As important as it is to start the cash flow in your direction each month, spending the time and effort to locate and vet the right tenants is still worth it. Find out why the high-quality tenants are so important, what qualities to look for in a commercial tenant, what process to follow in order to find tenants and how to vet tenants before signing a lease agreement.
The Important to Finding High-Quality Tenants
It is impossible to understate the importance of finding suitable tenants to lease your commercial property. Picking the wrong tenants could result in late payments that cause you inconvenience, and delayed payments over time could even put you at financial risk. This is especially true if you rely on this monthly income in order to pay a mortgage on the property. Poorly-chosen tenants might also do harm to the property, causing damage that requires a significant investment in order to fix. However, a thorough vetting and search process can help ensure that you end up with the right tenants for any commercial property.
What Qualities Make Up The Perfect Commercial Tenant
The qualities to look for in a commercial tenant, whether it is an individual or a business, include stability, ease of communication and reliability. Communication is often overlooked, but it is something that can foreshadow problems in the future. If you have trouble getting in contact at this stage, imagine how much harder it might be when the tenant is late with a monthly payment. You will also want a tenant with a good rental history behind them, a solid business plan and some success in their field already. Leasing a commercial property to a brand-new business is a big risk, and it may not be one you want to take.
The Process of Finding The Right Tenant
There are a number of different ways that you can find a commercial tenant for your property, but the most effective will almost certainly be online property websites. This lets tenants find you, and you will be able to choose from the best candidates. Another simple but effective way to attract potential commercial tenants is with a sign on the property that is visible from the street. Many individuals searching for potential commercial properties drive or walk around their desired neighbourhoods looking for openings. Don’t forget about the potential of word of mouth, which can also be a great way to attract the right kind of tenants who are already in your social or business network.
How to Vet Tenants Before Signing a Lease Agreement
Even if a potential tenant seems friendly, reliable and secure up front, don’t skip the vetting process. Some property owners can’t be bothered to spend the money and time on this step if all seems well, but it is vital when it comes to uncovering any past or hidden problems. Pull up the credit score of the potential tenant. Something low isn’t necessarily a deal-breaker, but be sure to ask for the reason behind the score. Also take a close look at the income they are able to generate monthly or annually, their rental history and their projected business plans for the future. Don’t be afraid to ask for previous references, even for residential properties.
These keys can help property owners locate and vet the perfect commercial tenants for any kind of space.