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Adam Craig
  • Investor
  • Cleveland, OH
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603
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NNN lease questions

Adam Craig
  • Investor
  • Cleveland, OH
Posted Oct 22 2019, 11:22

We are rehabbing a 6 unit office building - or possibly 4 units if tenants combine spaces.

After years of residential experience this is my first in commercial. I initially planned on hiring a commercial agent to help lease the property. But after meeting with one we decided I will just give them a referral fee if they bring me a tenant since I dont want ongoing management.

Reason being is because we already have our in houses management team, website, marketing materials, photographer,  ect... I guess I was mostly interested in picking their brains on lease structures and going rates.

Now that I am going in on my own I have a couple of questions.

1. Should I do gross lease/NNN/hubrid? The agent I asked about it didnt give me any clear cut answer. He said they have clients that do both. This property is in an extremely desirable downtown suburb location. After doing some comparable research in the area, I figure $1.00 - 1.50 /sq/ft is the going rate. Taxes are about $6500/year, insurance $1400.

2. When charging tenants by square feet - do you include stairs, hallways, storage closets, baths when coming up with this figure it they are going to be exclusive to the tenant?

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