You Need Commercial Real Estate in New Jersey: Should You Lease or Buy?

Posted by ANGELA RICH HARTMANN | Apr 27, 2021

Regardless of whether you're a larger company or a mom-and-pop shop, many business owners face the same question regarding commercial property. The decision to lease or buy commercial real estate should be carefully weighed. Factors like cash flow, location, and your long-term business goals will dictate whether leasing or buying commercial real estate is right for you.

Buying Commercial Real Estate

First and foremost, you need to know whether or not you can afford the costs of purchasing and maintaining a commercial property. Over time, buying can result in savings and even be an investment, but if your business is relatively new, then buying could be risky. Additionally, while market conditions shouldn't be your sole reason for committing to a commercial real estate purchase, it is better to buy in an area experiencing growth rather than a downturn. Another great reason to buy is if you'll need to make significant cosmetic changes to your business space—owning gives you the authority to do that.  Most business owners would love to make esthetic changes without first consulting their landlords; however, the decision to buy should ultimately be a financial one.

Leasing Commercial Real Estate

Leasing is appropriate when the decision to buy commercial real estate is financially premature. Leasing may also be the better choice even when you have the financial stability to buy. For example, if you're new to an area in New Jersey, leasing allows you to test the local market before committing to ownership. The typical commercial lease term is between 3 and 5 years, allowing for sufficient time to test the waters while remaining flexible.  You should also consider the amount of time and money you're willing to put into the maintenance work of a commercial property space—if that's not something you want to deal with, then leasing may be the better alternative.

Contact Hartmann Law

Making any commercial real estate decision requires a considerable amount of due diligence regardless of your intent to lease or buy. Buying requires a thorough examination of a property's structural integrity and its title history, while leasing necessitates a detailed negotiation of lease terms. Whatever your commercial real estate needs are, Hartmann Law is here to provide you with uniquely tailored commercial real estate legal guidance. To learn more, contact us today.

About the Author


Angela Rich Hartmann is a New Jersey attorney serving clients in the areas of estate, business, and real estate law.