16 Jun Five Things A Commercial Landlord Looks For In A Tenant
Potential Tenants
The dynamic between tenant and commercial landlord is a mutual-benefit relationship. However, a landlord has to put a lot of thought into their decision when it comes to commercial real estate. What criteria do commercial landlords look for? In truth, it depends from landlord to landlord. There are, however, a number of things that are consistent across the board. Here are five things a commercial landlord looks for in a tenant.
1. Clear Backgrounds
Clearing a background check is an important part in finding a tenant. If the potential tenant is a single business owner, landlords will often complete a background check. Additionally, they may request the potential tenant’s rent history. Essentially, passing these background checks will help the landlord tell how reliable they are as tenants.
2. Loyalty
Landlords also determine their potential tenant’s loyalty. One way to do that is by seeing how long they are looking to sign on for. A longer lease shows they are committed and loyal as tenants. Moreover, longer leases keep landlords from having to constantly track down new tenants so quickly.
3. Zoning And Property Type
Clearing backgrounds and showing tenant loyalty are important, but it also depends on what type of business is trying to move in. Different types of businesses have different requirements, especially for commercial real estate. For example, a medical business may need extra rooms for patient exams as well as extra storage space. Moreover, “zoning laws” dictate where different types of businesses can set up. These zoning laws designate different business types, including office, restaurant, industrial, and more. Essentially, the potential tenant has to fit these zoning laws to be able to move in.
4. Financial Reliability
A commercial landlord wants to know that they are bringing in a company that has the financial strength to stay reliable. In a nutshell, the landlord wants to eliminate any risk of being taken advantage of financially. They want to know payments will be on time and reliable.
5. Preparation
Finally, a tenant needs to show they are prepared to move forward. This means having a solid business plan in place. Additionally, this proves the tenant is ready to move quickly which is especially important in markets that are so competitive. A potential tenant that does not show they are prepared in advance to get moving will lose their place to someone that is.
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