Owning commercial property can be rewarding both financially and emotionally. However, while being a commercial landlord may come with certain benefits, it is often fraught with challenges. It is common to experience some legal issues during the course of your ownership.
While it is normal to encounter some complications, there are some steps you can take to avoid disputes and frustrations as much as possible. Here are a few guidelines for reducing legal problems as a commercial real estate owner.
1. Investigate potential tenants
It is always crucial to conduct due diligence on any prospective renters. Along with performing a credit check, you should search court databases to see if potential tenants have any convictions. If a possible tenant has a criminal background, think twice about renting to that person.
2. Be active and responsive
You should try your best to go above and beyond for a tenant, especially if he or she is not causing you any issues. Having a good connection with your tenants will reduce arguments from arising. Keep your property in good working condition by conducting regular maintenance. If any tenant brings a complaint or concern to you, make sure you listen and deliver a response in a timely manner.
However, it is also important to be firm when necessary. When a legal problem arises, such as a tenant failing to pay rent or causing property damage, inform the tenant of the legal consequences and procedures that will follow.
3. Document everything
Strong documentation will come in handy when any disputes occur. First and foremost, you must have an extensive lease for each tenant that contains specific terms. You must also complete a property inventory with a list of any removable items, appliances and the conditions of the structure. If any event occurs that causes you concern, make sure you document it properly and follow all procedures in the lease.