Finding the right commercial space is exciting—but it’s also a major commitment. While tenants often focus on location and rent, overlooking hidden issues in the building itself can lead to costly problems down the road. To protect your business, it’s important to know what warning signs to look for before signing a lease.
1. Outdated or Inadequate Building Systems
A space may look appealing on the surface, but if the HVAC, electrical, or plumbing systems are outdated or insufficient, you could face expensive upgrades or interruptions once you move in. Always confirm the age and capacity of these systems to make sure they can handle your operations.
2. Signs of Deferred Maintenance
Peeling paint, water stains, cracked windows, or worn-out flooring often indicate a landlord who hasn’t kept up with regular maintenance. If smaller repairs have been ignored, it may be a red flag that bigger issues could surface later—and you may end up bearing the inconvenience.
3. Poor Accessibility and Parking
For many businesses, accessibility is key. Limited parking, hard-to-find entrances, or non-compliance with accessibility standards can discourage customers or clients from visiting. A space that doesn’t accommodate your audience can impact your bottom line.
4. Hidden Restrictions in the Lease
Some buildings come with exclusive-use clauses or strict rules that limit what you can do with the space. For example, you may not be able to install signage, operate late hours, or make necessary alterations. These restrictions can hold your business back if not identified early.
5. Mismatched Tenant Mix
Who you share a building with matters. Being next to incompatible tenants—like noisy operations in a professional setting, or direct competitors—can negatively affect your customer experience. Review the existing tenant mix to make sure it aligns with your brand.
6. Environmental or Safety Concerns
Mold, asbestos, poor ventilation, or inadequate fire safety systems are not only dangerous but could expose you to compliance issues and liability. Tenants should always ensure that a property meets health and safety standards before moving forward.
Final Thoughts
Leasing a commercial space is a major investment, and overlooking red flags in the building can lead to higher costs, legal issues, or operational challenges. Being proactive in your due diligence will help you secure a space that supports your business long-term.
At JR Mercantile Real Estate Advisors Inc., we guide tenants through this process and help identify potential issues before you sign. Our expertise ensures you’re not only finding the right location—but the right building too.
