A commercial lease is a multi-year bet on someone else's business. The rent only shows up if the tenant succeeds — so screening the tenant matters every bit as much as negotiating the rate.
Talk to them — really talk
Sit down with the prospective tenant and go over their business. Understand the plan. Are they a growing or expanding business moving into the right space at the right time — or are they hoping the space itself fixes a struggling operation? You want to come away understanding whether they actually have what it takes to succeed in that location.
Get a personal guarantee
A personal guarantee is the clearest read on how serious a tenant is. A business owner willing to stand behind the lease personally is telling you they intend to make it work. One who refuses outright is telling you something too. It doesn't fit every deal, but it's one of the strongest signals you'll get.
Verify the fundamentals
- Business financials and history — is the operation real and reasonably stable?
- Credit — of the business and, where guaranteed, the principal.
- Revenue fit — can this location realistically support the rent the business needs to pay?
- Use and zoning fit — does their use actually fit the space and the zoning district?
Confirm zoning before the lease, not after
Make sure the tenant's use is permitted — or that a special use is realistically obtainable — before the lease is signed, and get the village's position in writing. A tenant who can't legally open is worse than a vacancy: now the space is tied up and producing nothing.
One related point on approvals: when a use requires village sign-off, the tenant's stated plans should be realistic, not embellished. If a business will realistically have five employees, the application shouldn't claim fifteen to look bigger. Villages size parking requirements, hours, and community impact off those numbers — an inflated plan invites scrutiny, higher requirements, or denial.
None of this is about being hard to lease to. It's about putting a tenant in who'll still be paying rent in year three.
