Many new tenants do not want to waste time and resources on drafting and signing a letter of intent with a landlord when they know all the same terms can be negotiated in a lease. However, if you take the time negotiate a few important terms early, as outlined in a letter of intent, it can help determine if the landlord is willing to accommodate dental specific needs before jumping full speed into a sixty page lease that will take much greater resources to review.
For example, did you know you could ask that the landlord not negotiate with another prospective tenant at the same time he is negotiating with you? All too frequently a space is taken right out from under a client because there was no language in a letter of intent prohibiting the landlord from negotiating with multiple parties at the same time. Did you also know you can negotiate for exclusive use on a building site? If negotiated early, you will find out whether or not the landlord has any interest in the long term success of your business. Further, negotiating tenant’s work and landlord’s work responsibilities and related tenant improvements allowances can give you an idea of out of pocket expenses that need to be put into the space.
Did you know you could spend upwards of $8,000 for a new HVAC unit because most units on buildings are not large enough to accommodate dental offices? If the landlord isn’t willing to pay for that up front expense, maybe you need to ask for more in Tenant Improvement Allowance or get creative with the rent structure, or maybe you need to look for a new space? All of these concerns, and others, can be addressed early and save you money if you need to walk away from the deal.
The attorneys at Thomas Law Group can assist with both the letter of intent and the review or drafting of a lease.