In a commercial rental 0 what should the tennant pay for and what should the landlord pay for?

I'm moving my business into a basement space of a salon and right now it's raw unfinished basement. It needs flooring (like carpet or pergo) and a couple of walls put in to divide the 2 separate businesses that will be renting down there. I also want then to tear out an existing closet which will make the space much more usable. Tearing out the closet is no bid deal except that is houses a huge oil tank that used to be used to heat the house. I"m sure that it will cost some money to get rid of the tank. I think that the landlords should put in the flooring and the walls and I should pay for the paint as I want a fancier that standard paint job. I don't know about that closet though. It will increase the value of the room but it's not a necessary improvement.

I have a meeting soon with the landlords and I need to come up with some kind of back up for my request for them to pay for the improvements

I'm sorry to tell you but most commercial lease is a triple-net-lease. What this means is that you will pay for everything, your share of the utilities since there is a salon, taxes, improvements, etc. Most will give you a grace of 3 months no rent to make improvements to make it use able for your business.

But like everythins else in real estate, everything is negotiable! So you can give it a shot. If the landlord needs money lost from the vacant space or if they are just plan nice, they will make exceptions. Good luck.

Commercial real estate leases (and purchases for that matter) are dramatically different beasts than residential. I don't claim to be an expert, but have worked through several restaurant build outs with my brother and have several other commercial rental properties.

Basically, the two sides have to come to an agreement. There is not really a fair or a WHO should pay for what up front. It kind of depends on who needs it more. Certainly there is room for the proverbial win-win. For example, if you are paying X/month for a 2 year lease and you are requesting that they do 12X of improvements - well - that may not be attractive to them. However, if you are renting a space b/c they said the rent is cheap, but you have to pay 12X to fix it up the way you want it, then you can see where your breakeven is.

Also, it may be more practical for one of you to pay upfront for the improvements.

For example, if they pay for $2,400.00 worth of improvements, maybe they charge you an extra $100 a month for 2 years. Or conversely, maybe you pay for that and they discount your rent. It really is a matter of who it makes the most sense for. If they (or you) are not reasonable about this, then the other party shouldn't walk - but RUN away.

I'm sure someone may offer up "it's customary to do 'abc'", but there is certainly no rule set in stone. Make sure both of you negotiate upfront AND in writing - he said, she said = bad news!

Good luck.

Joe...