In today’s business climate, everything must be documented. In some cases documentation can be a letter of agreement, or it can turn into a contract that goes for hundreds of pages.
Usually, most transactions can be handled with a something in between. Regardless of the transaction that may be involved, it is important to remember and laws vary in most of the states and many cities. There are unique zoning laws and various covenants that have to be considered.
Thus, any contract you enter has to meet all necessary legal requirements for the area in which the action is taking place.
Contracts can be simple or complicated. This depends on the attitude of the people involved, the type of property, the proposed activity and other factors such as location, emissions, trash piles and traffic.
Since a rental is not a lease, there should be no long-term commitment. The example uses six months with the right to extend. If the renter wants the original six months and then another, it would be wise to discuss the possibility of a lease, which gives more protection to the company, because the company that is leasing assumes more responsibility and it can let the owner know that the property is producing income and he does not have to look for another tenant.
Depending on the location, the type of activity, the size of the company owning the facility and the size of the renter, it may be necessary to add other provisions such as insurance certificates, environmental testing and impact on the area and how adjacent property values are being affected.
These are items that have to be discussed and cannot be a part of a check list. Such details have to be spelled out as to what the owner and renter expect of each other. Thus, it is feasible to start with a basic model of a rental agreement and then to adjust it to meet the situation and to possibly anticipate any problems or benefits that could develop in the future.
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