Renting a warehouse space is a major decision for you and your business to make. You want to make sure that you choose a warehouse that fits the needs of your business and can grow with you as your company continues to succeed. Warehouse rental contracts can seem complicated at first, but once all of the components are broken down, the rental process can become more manageable. So exactly what important information is not included in your rental contract?

The answer is, it depends on which rental lease option you choose. Your rental contract covers a lot of essential elements, but there are still a variety of crucial aspects that are not mentioned in the contract. There are additional expenses that are required for you to run your warehouse such as inventory, insurance, equipment, and in some cases, utilities. Before you rent a warehouse or any other space, you must evaluate all of your expenses so you’re better prepared.

What To Consider Before Renting

There is a lot for you to consider before renting a warehouse space than you might first expect. One aspect you should think about first is how much you want to spend. It’s important for your business to develop a budget, stick to it, and then find a warehouse rental that checks off all of your boxes. Location is another significant part of the process. This will narrow down your perspective options and make it easier to decide which warehouse you want.

Once you’ve settled on a location or a general area, the next decision you’ll make is how much space your company needs so you can run your business effectively. Finally, decide how long you want to rent the space. Whether you plan on staying for a couple of months or several years, you want to ensure that you pick the best warehouse rental for your business. Also, you want to make sure your rental contract is right for your business; some contracts can leave out utilities and maintenance, for example, that your business might want to be included.

Benefits of Renting a Warehouse

So you’re trying to decide if you should buy or rent a warehouse space. There are benefits to both, so let’s break down the benefits of renting. Is your company planning on staying in the warehouse for a short period of time? If you are, then renting will most likely be the better option for you. Another benefit to renting is that you are not tied to the huge commitments of owning and maintaining the warehouse, and you can leave as soon as your rental contract expires. Lastly, depending on the type of lease you have, renting a warehouse may cost less overall than buying.

Forklift truck in warehouse or storage and shelves with cardboard boxes.

Types of Warehouse Rental Contracts/Leases

There are three types of warehouse commercial leases for you to pick from. The most popular are net leases. Net leases are broken down into three categories: single-net lease, double-net lease, and triple-net lease. These categories are differentiated by the number of “operational costs” that you’re responsible for. Single-net lease does not include two operational costs and double-net lease leaves you responsible for one operational cost.

A full-service lease is where you would only pay for the rent of the warehouse. The utilities, taxes, repairs, and overall upkeep of the building are the responsibilities of your landlord. Modified gross lease is the third type of lease. With this lease, your business pays the rent and some of the operational costs that you and your landlord agree to. Depending on what you and your landlord agree to, your rental contract could exclude certain operational costs, and therefore, leave you responsible for them.

Your Responsibilities

After you’ve picked a warehouse to rent, it’s crucial for you to go over your responsibilities associated with renting. One key responsibility not included in your warehouse rental contract is having enough parking on your rental property for employees and visitors. If you find that parking may be difficult at some times, find a parking alternative that is in close proximity. Additionally, in order for you and your employees to do an effective job, your business must supply the necessary tools and products, such as forklifts, pallet jacks, dock levelers, and more. If you factor in these responsibilities and expenses, you will be going down the path to success!

Need More Clarity?

Do you need more information or have any questions about your warehouse rental contract? Our knowledgeable team at Schwarz Properties can help guide you through the process! Our goal is to make the rental process easy, understandable, and stress-free with dedicated staff and no broker fees. At Schwarz Properties, we have a variety of warehouse rental properties with over 20 million square feet available and ready for you to use! Give us a call at 336-625-6076!