Lawyer Raymundo Larraín Nesbitt explains to us the questions you should level at your estate agent when you are hunting for office space in Spain. He also supplies us with some basic tips to avoid the most common pitfalls.
By Raymundo Larraín Nesbitt
Lawyer – Abogado
24th of May 2017
So, you have finally made up your mind and decided to take the plunge setting up your own business in Spain? Good for you.
One of your fist port of calls, on prowling for suitable office space in Spain, will be an estate agent and a seasoned lawyer.
The following are just some of the basic questions you should be asking them, or the landlord, before you commit to signing on the dotted line.
Nothing worse than making a huge down payment upfront only to realise you have been duped out of your money leasing from someone who was not legally empowered to do so.
Do not get short changed on this as leases are often calculated based on the property size and if your property is considerably smaller you will get shafted overpaying.
Nowadays modern business needs require high-speed connections to internet. You really do not want to get stuck leasing office space that still uses a 48k dial-up modem, do you?
Something which is so basic is often taken for granted and overlooked on searching for office space. Unless you plan to set up a boiler room (hearsay has it that it is a very lucrative source of income in Spain) you need your company logo on the exterior. Some communities of owners do not allow this, some business centres (centro de negocios) also disallow this. Needless to say, you really need one unless you are into shady business.
As I care to explain in my article Urban Rental Law in Spain there is freedom to negotiate with a landlord how many month´s deposit is required as a rental guarantee. Whilst the general practice is a two-month deposit for commercial premises (as per law) I stress there is leeway to negotiate, particularly on high-end commercial lets. For example, a beachfront pad located in a prime location such as Puerto Banus (Marbella) could set you back 12 months. Particularly if you are a non-resident tenant with no ties to Spain, a landlord will ask for more cast-iron financial guarantees (to hedge himself) as you may be perceived as a risky option. It is convenient this is cleared and negotiated by the parties from the outset as it is often a contentious point. More information on rental guarantees in my article: Renting in Spain Safely.
To avoid yourself nasty surprises this will be one of the first questions you should be asking. As a general rule, landlords shore up with both. However, in practice this may not be the case. So, make sure you ask first to be on the safe side. IBI tax is explained in my article Non-Resident Taxes in Spain. CO quota is explained in my article Community of Owners.
Again, a question that is frequently overlooked by would-be-tenants. The general rule is that the landlord pays for it but can be agreed otherwise so careful with the small print. Rubbish collection tax is explained in my article Non-Resident Taxes in Spain.
Although the answer may seem rather obvious at first, that it is the tenant who pays for both, in practice you may be surprised to learn that it is in fact the landlord who pays for water in office lets. Electricity is paid for by the tenant. You should also inquire if the utilities are currently connected to the supply grid unless you fancy the excitement of waiting for weeks on end (the infamous mañana, mañana one dreads to hear) for someone to actually turn up (unannounced) at the property and connect you…
Spain is a hot country all year round, particularly in the summertime. You really do not want to get stuck signing off a 12-month commercial lease only to find out the AC system is a vintage General Electric machine harking back to the 50s. This is one expense you should not be dragging your feet on and splash generously; bottom line, get yourself a good modern AC system.
Success or business failure is often linked to your rapport with a landlord. Try to always be on his good side as they can easily make your life downright miserable. You should ask your agent on this.
Remember the golden rule that no matter how charming an estate agent may seem (Hollywood smile and all), he always works for the landlord; not for you. Don´t make (wrong) assumptions and do your own research.
For your own good, hire a competent lawyer from the outset to review any lease agreement before you commit and sign on the dotted line (or any other legal document for the matter). You will save yourself considerable money and aggravation on the long run sidestepping the most common blunders professionals are all too keenly aware of.
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Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.
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