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Why you need more than real estate agent when leasing a space

There are many factors that contributed to choosing a suitable location. Some of these items may be: Parking, business allowed by Zoning, do you need a building permit in order to open, based on the unit how many people could fit in the space? Does your unit contain enough exits? In a typical deal these answers would come from the landlord. The answers to these questions would be based on what the landlord would allow, but not necessarily what the municipality would allow.

Need more information?

Need more information on how that works? For example you are opening a computer repair shop, the previous owner had a small retail space. The landlord has given you 2 parking spots and agreed that a computer repair shop would be a good fit. When reviewing the space, you note that you only need to complete superficially updates. You agree to the lease and move in. Is that is? The landlord gave you the ok. You did not do any construction -so what is the problem? So lets break this down. There are three factors to consider when reviewing the unit in terms of use.

1. Does the landlord allow it?

2. Does the municipality have the building zoned to allow it?

3. Does the building code allow it -or do you have to complete a change of use aka a permit?

What are the answers??

One is a relatively easy answer- ask your real estate agent to ask the landlord. Easy easy.

Number two, a little more challenging. The municipality zones every property with a code called “Zoning” this code translate to a larger name, that translate to allowable use on the property. For example, the property could be zoned C1 (made up for reference). C1 could mean Commercial One. And the allowable uses are Retail, Office, and restaurants. Your business type must be on this list (or you must go through a whole other process in which we will blog another day about). The maps and zoning by laws are found online (or through us if you want the easy route).

And number three the most challenging one-what is your occupancy type. Arggg what is that??? I know-so outside of the municipal requirements, buildings are governed by the Ontario Building Code. Types of spaces are divided into 6 different Groups (A-F). And again, a full description will be in another blog. But as an example, from above, a retail store is an E Occupancy and a computer repairs is a D Occupancy. Each Occupancy has a different set of rules (such as washroom amounts, fire ratings, mechanical, ventilation etc.,) So unless you are moving into a space that had the same use as you, you will need a permit (what is included in a permit set for a change of use is yet another blog).

What about the Parking?

Now the other issue made was parking!!!! Parking is one of my pet peeves because it is a negotiating tool that is used in leases but typically it’s the decision of the city. Meaning this: Each use has an amount of required parking. For example, this maybe determined by the unit size or use. So, what happens is you move into your unit and you need a permit. You apply for the permit and the city says -oh by the way do you have a site plan with the parking statistics? In a large building the landlord most likely has this completed and sufficient parking for any use. But sometimes in an old plaza, no one has one. So next you have to have a site plan completed, all the units counted, all the parking counted-and guess what you need 5 parking spots, and you only have two. Well what happens now? You can try for a minor variance (which we may win depending on the argument) or they may say no sorry you cannot have this use here. And guess what you signed a 5 year lease in a space you cannot use. Shitty right?!

Whose fault is this?

YOUR FAULT, because it does not fall under a real estates job. Their job is to negotiate with the landlord not find out what the municipality, the building code and the all other people who may get involved want. So point being-you need more than a real estate agent -you need a team who can check this stuff (if its not obvious that is us 😊).

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