Renting a warehouse to sublet

[realestatebiz]

Hey guys
I'm planning to rent a warehouse of 17.000 square feet that includes some office space. My idea is to re-decorate the office space in a crisp co-working space design. I still have around 11.000 square feet and wonder what I could do with that space. The co-working will gain me enough money to pay the rent but not enough to make a living and any profit. Anyone that has any advice?

 

[Chris Ashdown]

It's not a case of just sub letting as if you say go bust the other tenants are still in the building and it would cost in time and money for the landlord to get them out, Therefore I would expect the landlord to only allow them on something like a yearly licence to occupy, which may be a disadvantage to the other users

 

[Ashley_Price]

The first thing you will need to check is if your rental agreement will allow you to sublet.

 

[realestatebiz]

I am allowed to sublet as the property owner is a relative of mine. He's flexible with the majority of ideas..

 

[patientlady]

Make sure your terms and conditions are water tight, (especially with relatives lol). We lost our business in the early 90's through this. One of the companies that were renting from us pulled out over night and we didn't have a leg to stand on. They had 25,000 sqf ouch! The terms and conditions we had with this company had not been checked by our solicitor and unfortunately we could not then pay the rent for the nxt quarter. Next step was the bailiffs

 

[Ashley_Price]

I am allowed to sublet as the property owner is a relative of mine. He's flexible with the majority of ideas..

Another thing to consider is how much notice will your landlord (your relative) have to give you if for some reason he suddenly wanted the building back?

While, three months say, might be okay for you, for those you are subletting to, that might be too short a notice period.

And, as @patientlady says, you need to check everything over with a solicitor - don't just take your relative's word as gospel. I am not saying they would purposely defraud you, but by not putting certain agreements or contracts in place "because we're family", they could end doing something that costs you financially.

 

[Chris Ashdown]

Family should never be joined by business without strong legal agreements

You would need full legal agreements for whatever you arrange, treat it just like anyone else would

Check fully sub lease and what it entails and if a licence would be a better solution

Each area would need independent metered services and full insurance coverage if the say burnt down the place and put x number of other companies out of business

 

[realestatebiz]

I've actually opened this topic to get inspired by advice on what to do with the left-over space... That's what I'm really looking for... good ideas by some of the good people of this forum... thanks!

 

[Chris Ashdown]

Let it out as a Antiques centre where sellers buy a space for their goods and one person is available for security and sales, With good floor space and also small area's you may well get 20 or more people taking a bit of space

 

[Copperwood]

You could fill it with 20ft shipping containers and rent them out as self storage

 

[realestatebiz]

thank you all for your input