Renting A Space For An I-Café

In this article, I will not discuss about where, how big and how much must you pay for a space that you intend to rent for an i-café business that you want to open. Those factors are very important to consider and I do not want to mess with your decisions on the matter. Only you as the owner of the business must weigh those variables and take the responsibility for the decision that you will make on the matter.

Rather than those, I will discuss here the various terms and conditions that you must negotiate for with the owner of the space that you will rent. We often read about complaints of i-cafe owners who gets harassed by the demands of their landlords after they occupy the space and their businesses got started. This is the situation that we want to avoid so I want to enumerate some terms and conditions that you as a would-be lessee must seek  agreement with the space owner to avoid the misunderstanding that may arise if the following are not included in your contract of lease with him.

A. Term of Lease – This refers to the number of years that you will rent the space under the contract. Negotiate for at least three (3) years. While most lease contract have only one-year term, it is best that you ask for longer term to ensure you continued occupancy of the space especially if your i-cafe business turns out to your expectations. Take note that a more than one-year term will normally stipulate an escalation clause (percent increase) in the rent after the first year. The usual “two (2) months deposit, one (1) month advance” payment will likewise increase depending on what you will agree with the space owner.

B. Rights vs. Deposit – Even in these days, there are building owners who demand that you buy the rights to occupy the space you want to rent instead of just putting up a deposit  for its use. The difference between the two is that if you buy the rights to occupy the space, you will not be refunded of the money you paid until a new lessee buys your rights while putting up a deposit entitles you for the refund of the amount you paid less some rightful deductions like unpaid utility bills that you incurred at the time you surrender the space to the owner. Without saying, deposit is better for you as lessee in the contract.

C. Non-Competition Clause – This is a very important provision for the protection of your business. You should ask your lessor to include in the contract that he will not allow another i-cafe business to be put up in his building. You may ask me what can you do if your landlord violates this term? Can you sue him for damages? I doubt but you can always leave his premises when he violates your contract and he loses a good lessee if you are a diligent payor of your obligations to him.

The above terms will not guarantee your success in the business but they will more or less give you the peace of mind as to the terms of your renting a space for an i-cafe is concerned. Aside from the above and on a case-to-case basis, there could be some more terms  you that need to negotiate with a prospective landlord to ensure your smooth sailing stay on his property. Don’t be shy, ask for them before you finally decide to rent the space for your i-cafe.