How to Lease Commercial Space in Calgary

A Guide for Business Owners

Leasing commercial space in Calgary is a significant decision that can impact your business’s operations, growth, and financial health. With Calgary’s diverse commercial real estate market, it’s essential to navigate the leasing process with a clear strategy. This guide will provide practical tips that will assist business owners in finding the ideal commercial space that fits their needs and budget.

1. Assess Your Business Needs: Begin by evaluating your current and future requirements:

• Space Requirements: Determine the amount of space needed based on your operations, team size, and workflow. Consider potential growth to avoid outgrowing the space prematurely.
• Layout: Open-plan area, private office, warehouse or a combination-the choice depends upon your organizational culture and operational requirement. How many sq feet of Warehouse space vs office do you need?
• Amenities: Specify facilities like meeting rooms, storage rooms, or particular facilities. More often than not, high-speed internet, kitchen, loading door (dock or drive-in), and parking play a vital role in productivity or employee satisfaction level.

2. Choose the Right Location: Selecting the optimal location is vital for any operational success and the accessibility of the clients.

• Location: Business areas differ across Calgary, with each location possessing its distinct advantages: Downtown Commercial Core, which is suitably positioned for office space, networking, and accessibility; and Beltline-type areas offer bright alternative prospects to startups and creative industries. The multiple industrial parks situated on the north and southeast side of Calgary and the outskirt areas have made available to the users of Industrial Bays manufacturing facilities, warehouse bays for sale or lease, large-scale distribution, industrial land, and many others.
• Accessibility: Ensure the location offers easy access to the employees and customers, based on access via public transportation and major roadways.
• Local Amenities: The availability of restaurants, banks, and other amenities enhances your employee’s experience and creates a positive impression for clients.

For further details, see Calgary’s business district profiles. (calgary.ca)

3. Understand Lease Types and Terms

Familiarize yourself with common lease structures and terms to make informed decisions:

• Lease Types:
  • Gross Lease: The landlord is responsible for all property-related expenses.
  • Net Lease: Tenants pay base rent plus a share of property expenses, such as taxes and maintenance.
• Key Terms:
  • Lease Term: Align the lease term with your business plan, but also allow flexibility for growth.
  • Rent Escalation: Know how and when rent will increase.
  • Operating Cost and Maintenance: Know who is responsible for repairs and maintenance.

Being able to negotiate favorable terms can save thousands of dollars.

4. Budgeting and Cost Considerations

Develop a comprehensive budget that includes:

• Base Rent: Commercial rental rates in Calgary can vary depending on the location and the class of the building.
• Additional Costs: Account for utilities, maintenance fees, property taxes, and insurance.
• Upfront Expenses: Include costs for security deposits, initial renovations, and furnishings.

A thorough budget helps prevent unexpected financial strains

5. Work with a Commercial Real Estate Broker

Engaging a knowledgeable broker can streamline the leasing or buying process, saving you time and money:

• Market Insight: Brokers can provide access to listings and market trends that may not be publicly available.
• Negotiation Expertise: They can actually negotiate lease terms on your behalf, possibly obtaining better rates or conditions.
• Local Knowledge: Firms like NAI Advent and specifically Calgary Commercial Group offer specialized services tailored to the local market.
• Zoning: The experts at Calgary Commercial group can help you navigate through the City or Municipalities’ zoning guidelines to ensure your business can operate in your chosen location.

6. Plan for Space Customization

Tailor the space to reflect your brand and meet operational needs:

• Design and Layout: Consider how the space can be configured to support your operations and company culture.
  
• Tenant Improvement Allowance: Negotiate with the landlord for contributions toward customization costs.

A well-designed space boosts employee morale and productivity.

7. Free Rent or Fixturing Period

A good commercial real estate agent will generally be able to negotiate a free rent period at the beginning of the lease term to ensure you have time to get your business set up, complete any the next time you are looking for work that needs to be done to the space and prepare for opening day.

8. Legal and Financial Due Diligence

Before signing the lease:

• Legal Review: Have the lease reviewed by a legal expert, who can point out potential liabilities and compliance with local laws.
• Financial Assessment: Make sure that your company will be able to bear the financial commitment for the lease period

Due diligence saves your business from disputes arising in the future and financial issues. (norr.com)

9. Tips for a Smooth Move-In Process

Ensure a seamless transition into your new commercial space:

• Timeline Planning: Allocate enough time for renovation work, installing IT infrastructure, and setting up furniture.
• Professional Assistance: Consider engaging the services of professional movers and IT professionals for logistics.
• Communication: Inform your clients, suppliers, and stakeholders about the new address and/or temporary changes in operations during the move.

Commercial Real Estate Decisions are some of the most important operational and financial decisions a business can make. Ensure you engage a commercial real estate expert and leverage their market knowledge and expertise the next time you are looking for a warehouse, retail location, land or office.