Choosing the right commercial property can be a protracted process. Finding a facility with the right amenities could take some time. The search may last even longer if there are budgetary constraints. When you find a commercial property that falls within your budget and would meet all of your company’s immediate needs, you might want to act quickly so that you don’t lose the opportunity. 

However, verifying that local ordinances allow your business to operate at that location and that its zoning fits with your intended purpose is also a necessary step before you make an offer on a property.

Changing the zoning is a complex process

Most people looking at commercial properties understand that land use or zoning rules affect their use, but some people assume that they can change the zoning to suit their needs after buying. Yes, if you buy a property that is ideal for your company’s needs, you may be able to have the property rezoned. 

You could ask for permission to develop vacant land in a way that differs from the current agricultural zoning. You might want to develop mixed-use spaces or turn vacant industrial spaces into apartments. It is possible to change the land-use rules that apply to the property, but doing so is a lengthy process with no guarantee of success. The local community will have a say, and there could be opposition to your plans. 

For most businesses, it will be better to find a property with the right zoning already, even if it means waiting many more months to find the right commercial real estate. Learning more about the rules that apply to commercial properties can help you invest in the right real estate for your company’s needs. 

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Commercial leases differ from residential leases in many ways. For example, a residential lease is usually a gross lease that the landlord uses to pay the mortgage, taxes, and insurance The renter is normally responsible only for paying for some or all of the utilities.

Most commercial leases are called “net leases” instead of gross leases. This provides a cheaper lease payment, but there are other things that the business has to pay. It’s imperative that the tenant’s responsibilities are spelled out in the lease. 

4 types of net leases

There are four types of net leases that are used for commercial properties:

1. Single net lease: This is often denoted as an N lease. The tenant pays property taxes and their lease payment.
2. Double net lease: It’s often called an NN lease. The tenant pays the lease payment along with insurance premiums and property taxes.
3. Triple net lease: This is called an NNN lease. The tenant is responsible for the lease payment and the expenses related to the rental. This includes insurance, property taxes and maintenance costs.
4. Modified net lease: This type of net lease is customized to fit the needs of the tenant and the landlord. It can include shared costs for the expenses common in the other net lease types.

Commercial leases must accurately reflect the terms the landlord and tenant agreed upon. Both sides should review the lease before signing it to ensure that it’s accurate and contains all the terms necessary. It’s usually best to have someone review the lease so you know that there’s nothing you missed that could come back to haunt you later. 

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Some partnerships start with so much promise, only to end up in a sorry state years down the line. It all boils down to falling out among the partners in most cases. No matter your relationship with your business partner, anything can go wrong in business, and friends may become foes.

If you are planning to set up a partnership, you need to know and anticipate these common causes of disputes among business partners.

Money

In most cases, disputes revolve around finances. For example, if one partner feels like they are being shortchanged or there is poor accounting of the business funds, it is likely to cause a dispute since every partner has an interest in the business. Alternatively, one of the partners may feel like they deserve more since they are putting in more work or effort in the business.

Duties and responsibilities

There should be clearly defined roles and responsibilities in a partnership. Sometimes partners may clash over who is in charge of certain aspects of the business when making critical decisions.

Breach of fiduciary duty

If you are in a partnership, your business partner is required to act in the business’s best interests. If they do not, and their actions are fraudulent or only meant to benefit themselves, it may cause a dispute with the other partner.

Be prepared to deal with disputes with your partner

Doing business together will often cause a clash of ideas or opinions between you and your business partner. However, how you handle these disputes will determine the success or failure of your partnership. While it is advisable to try and resolve matters behind closed doors, you still need to be prepared to protect your business interests in case things go all the way.

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As a landlord, you may have had enough with a particular tenant. They could constantly be violating the lease terms or creating a nuisance to other tenants in your property. In such a case, you may be tempted to take matters into your own hands and evict them from your property. However, it is not advisable since you could find yourself in legal trouble.

You are required to follow certain procedures as the landlord when evicting your tenant.

You need to give written notice

Under California law, you must inform the tenant beforehand of your intention to terminate the tenancy agreement early. For instance:

If the tenant defaults on rent, you can give them a three-day notice to pay the rent owed. If they don’t pay, you can then take action towards evicting them.

You can also issue the tenant a three-day notice to cure lease violations or face eviction. This applies in situations you think can be rectified by the tenant for their continued use of the premises.

However, the tenant may commit serious violations to the lease agreement, such as damage to property or has been involved in illegal activities within the property. In that case, you may give them a three-day unconditional quit notice. It means that there is no space to correct their violations, and they should pack and leave within three days. Remember, the three days do not include weekends or other judicial holidays.

Avoid any troubles with the law

It is important to follow the eviction process carefully. It could help you avoid any legal issues that may arise later on with the evicted tenant regarding their eviction.

Learning more about what you need to do as a landlord, including dealing with any property left behind by the tenant, will safeguard your interests and ensure a smooth eviction process.

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Commercial lease agreements often bring numerous benefits to all parties. The operator of a business has a desirable space to carry out their commercial activities, and the owner of the property receives a steady income. 

Unfortunately, commercial lease agreements do not always work out, and disputes may arise. So, how does this happen? And how might such disputes be resolved? 

Unambiguous terms in the lease

More often than not, disputes regarding commercial leases relate to the terms of the contract. It is vital that contractual terms are clearly expressed so that all parties know exactly where they stand. Frequently, tenants assume that they have access to certain utilities, which the owner had no intention of including in the deal. Confusion over contractual provisions is a sure way for conflict to occur, so it is vital that all parties have a frank discussion about their expectations before committing to a deal. The outcome of these conversations should be incorporated within a watertight contract.

When a landlord oversteps the mark

A landlord may rely upon the profitability of a business to ensure that they obtain regular payments. This means that they have an active interest in how business operations run day-to-day. Their motivations may stem from securing short-term payments, rather than ensuring that the business remains profitable for the duration. Tenants may be at odds with these values, making the possibility of a dispute much more likely. 

When a tenant oversteps the mark

It is possible that tenants overstep the mark and wrongly assume the position of the property owner. For instance, they might opt to make significant renovations to the property without any permission. For this reason, it is vital that a lease agreement clearly sets out who is responsible for building repairs and renovations. 

Commercial leases can be beneficial for all parties, but only if they are well-drafted. If you are facing a dispute over commercial real estate, be sure to gain a firm understanding of your legal rights in California. 

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When you would like to invest in commercial real estate, it makes sense to purchase buildings that are easy to rent out and to keep maintained. It helps if you’re able to purchase a solid building to begin with, so you can keep up with minor maintenance and make your tenants comfortable.

Not all commercial real estate is a good buy. In fact, many of the commercial properties on the market may not be right for you. Certain real estate will be a better target for you, but you need to know what to look for.

What should you look for in a good commercial property?

A good piece of commercial real estate will be suitable for what you want to do with it. For example, if you planned to rent out space to residential tenants, you may want to buy apartment buildings or condos. If you would rather rent space to businesses, then there may be mall spaces or large office buildings that you want to look at instead.

When you invest in commercial properties, you may want to balance your investment with something that has an excellent return on investment without much maintenance work. For instance, if you invest in storage units, you won’t have to worry about live-in tenants damaging the property.

Instead, you may need to hire 24-hour security to monitor the facility, but in general, it’s a hands-off way to bring in money with little risk of needing to do repairs. If you don’t have a heated/temperature-controlled unit, then it’s more like maintaining garages than buildings, which makes things even easier.

Avoid high-risk properties to protect yourself

There are some higher risk properties that you may not want to invest in, too. Single-tenant buildings are among them. So, if you want to hedge your bets, the better idea is to invest in a property that you can lease to multiple people or businesses at the same time. That way, if one leaves, you will still have others paying. You will then have time to bring in another business or tenant, so you can boost your incoming profits once again.

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You may have the drive and determination to fulfill several companies. However, the reality is that you also need capital to bring your ideas to fruition. 

Bringing in outside sources of help can be a daunting prospect, especially when you have invested so much of your own time and money into growing your company. Fortunately, there are several ways to tell whether or not a potential investment partner is for you.

What role do they intend to play?

Do you need a silent partner or someone who can take on a more hands-on approach? This is an important question to ask yourself when seeking investment partners. 

A bold and intrusive personality could disrupt the whole flow of your company, as well as upset key staff. It is vital that any investment partners fit in with the successful culture of your organization, rather than opting to dismantle it. 

Are your values compatible?

Your company may pride itself on being open and honest with customers as well as treating staff with the dignity they deserve. Does your potential investment partner feel the same way? 

The corporate world can be a ruthless place at times, and your core values might not be shared by everyone. Although small compromises are always necessary for the business, you may regret sacrificing the key principles that your business is founded upon. 

Growing your company can be a significant challenge, but with appropriate investment, you can get there. Choosing the right partners and colleagues will be crucial to your success. You should also keep in mind your legal rights as an entrepreneur in California.

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After notifying your landlord several times about an issue in your apartment, you have run out of patience. The problem has not been repaired or resolved. 

You turn to a state agency that helps tenants in tenant-landlord disputes. After the agency contacts your landlord, you receive a phone call, threatening to evict you because of your phone call to the agency.

Retaliation is seeking revenge for a tenant’s legal action

A retaliatory eviction is a form of seeking revenge. Your landlord is not allowed to threaten to evict you because you exercised your legal right to complain about the upkeep of the property. By not making repairs, your landlord is effectively violating the terms of your lease.

Aside from an illegal threat (or act) of eviction, other retaliatory acts may not be allowed. These include: 

• Raising the rent after you request repairs
• Harassing you verbally over the repair requests
• Accusing you of not paying your rent on time
• Claiming that you’ve forfeited your security deposit for some bogus reason
• Small, petty actions, like locking you out of the laundry room
• Effectively evicting you by changing the locks or turning off the utilities
• Suddenly writing you up or sending you notices about “problems” that were never a problem before

While your landlord might not appreciate your requests or your actions, they are not allowed to use any kind of retaliatory action against you.

Make sure your landlord follows the lease you signed

Learning about how you can protect yourself in matters related to a retaliatory eviction can help you if something goes wrong. When all else fails, however, don’t hesitate to seek legal assistance.

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Finding the right business partner is no easy task. You need to ensure that the people you work with share your core values and vision for the company. 

You may have gotten yourself to this point and committed to an arrangement, only for things to turn sour at later date. The reality is that at least 70% of business partnerships fail. There are ways around this and tackling issues head-on at an early stage is extremely important.

Outlined below are some signs that your business partnership could be in trouble:

When there’s a breakdown in communication

Is your business partner giving you the cold shoulder? Perhaps they are irritable when you do make contact? A solid business partnership is founded on effective communication. If you have caught your colleague in a lie, or simply cannot get an answer out of them, this is likely to harm your company in the long run. 

When nobody is interested in finding solutions

It is rare for a business not to run into roadblocks on occasion. What’s important is that these obstacles are navigated as a team. If your partner is highlighting problems without considering possible solutions, this could spell trouble. A positive outlook is generally needed to come through the other side when things get tough. 

When the workload becomes one-sided

In any successful corporation, all team members pull their weight. A lack of work ethic could be a sign that your partner has lost interest. You shouldn’t be placed in a position where you are constantly forced to pick up the slack. Productivity is a key aspect in hitting all of your targets and staying on course. 

If you and your business partner are at loggerheads, it is important not to panic. By having a firm understanding of your legal rights, you will be able to find a solution. 

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If you live in the Los Angeles area, you likely know someone who at one point lived in someone else’s garage because that was all they could afford – or maybe that person was you. People moving to California from other parts of the country can experience serious sticker shock at the cost of renting even a small apartment. 

Most of these garages, which fall under the more sophisticated term of accessory dwelling unit (ADU), have not always been legal under California law. As California lawmakers have worked to tackle the state’s serious shortage of affordable housing, these laws are changing. In fact, The New York Times recently featured a story about a man who had been living in his parents’ garage behind their home for years. The architecture student converted the space into one that many apartment dwellers would envy. As he noted, however, he’s only been living there legally for a few months.

What makes a garage a legally “habitable space?”

Even with California housing laws becoming more lenient, that doesn’t mean you can automatically rent out a garage as a home. It has to be habitable space. Specific requirements must be met. Not doing so can result in significant fines. In fact, even letting someone stay overnight in your garage, if it hasn’t been properly converted, can get you fined.

While individual city and county laws vary, to be considered a “habitable space,” a garage (or shed or any other structure on a property) that is used in part for sleeping must meet some basic requirements regarding ceiling height, natural ventilation and light, window size, temperature and more. It must have a smoke detector, electrical outlets, plumbing and a lock. It cannot have a gas water heater and can no longer be used as a “garage” in the sense of someplace to park vehicles.

If you own one or more real estate properties that have structures you’d like to turn into ADUs that you can rent, it’s crucial to know and abide by all of the relevant local and state laws and regulations. The best way to ensure that you’re in compliance is to have experienced legal guidance.

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