The signing of a lease agreement is a key step between you and your tenant. Lease agreements are in place to protect both your business and customers. There are many resources online, such as your states Self Storage Association website, that can help identify specific requirements your facility needs to include in its lease agreement. In this article, we will outline three basic aspects of lease agreements. This article can be used as a starting point for identifying key elements of your lease agreement to aid your facility.
You might how your lease agreement looks is not a huge deal. Yes, it is a legal document but it also is a marketing tool for your facility. The aesthetics of the lease agreement builds trust between you and your tenant. On your lease agreement, we recommend using basic aesthetic guidelines, such as:
- Including your facility logo
- Including facility contact information
- Ensuring the document font and sizing is readable
Go over your lease agreement page by page with the tenant to ensure they understand the document and what they are signing.
Terms Of The Agreement
This is the meaty section of your lease agreement. This section of your agreement should include:
Terms: Once the contract begins, the terms specify the end date. It may be an annual contract or month to month. The terms also specify how the renter can terminate the agreement. For storage facilities, lease agreements tend to be month to month.
Unit Purpose: This section of your lease agreement allows the facility to state what tenants can store. It should also include if you have a limit on the value of items stored. It is recommended to include a section stating the renter will not store items of sentimental items. Below is an example from Colleyselfstorage by Polizos Properties LLC.
“The Occupant agrees that the Space is not appropriate for the storage of jewels, furs, heirlooms, artworks, collectibles or other irreplaceable items having special sentimental or emotional value to the Occupant and Occupant agrees not to store said items. The Occupant hereby waives any claim for sentimental or emotional value for the Occupant’s property that is stored in the Space or on the Property.”
Payment And Rate Changes: This section discusses how much a unit will cost. It will also state when payments are due. Include a provision, stating, "upon written notice on said day rent will increase," allowing your facility to keep up with market rates.
Rental Termination: Not all tenants will be perfect. This clause will allow you to terminate the rental agreement within the specified window of notice your state requires. Make sure to know your state's rules and regulations, so you can properly follow them.
When finalizing your lease agreement, you should make sure there are multiple statements that remind the tenant that they are storing their goods at their own risk. Be clear that break-ins can happen and remind tenants that they should have insurance for their items because they are responsible for the contents of their unit.
Many storage facilities offer some form of insurance or protection for their tenants and their belongings. Discuss these options with your tenant and consult a lawyer on what legal clauses these options would add to your lease agreement.
There are many requirements to meet before finalizing your lease agreement. In this article, we have outlined the most demanding sections to address. Use the resources that your state's Self Storage Association provides. As well as have a lawyer, who knows the laws in your state, review your lease agreement before tenants sign it. If you are interested in getting pre-made, state-specific storage forms, including lease agreements and other documents, Easy Storage Solutions’ Storage Agreements is a great place to start.