FAQs for renting your commercial property

by Darren M. Malek on Oct. 04, 2019

Real Estate 

Summary: When you invest in commercial real estate, having a plan in place to handle issues that arise will streamline your operations and build your local reputation as a trustworthy business owner.

When you invest in commercial real estate, having a plan in place to handle issues that arise will streamline your operations and build your local reputation as a trustworthy business owner. In Michigan, the laws governing commercial property rental are much less strict than those for residential leases.

Review these guidelines to ensure that your Michigan property adheres to the appropriate laws about leasing and other aspects of commercial real estate.

How much can I collect as a security deposit?

While residential properties are subject to a security deposit cap, commercial landlords have no such limits in Michigan. For some properties, the tenant must replace part or all of the security deposit after the landlord uses the funds for repairs.

Who maintains the premises?

Commercial landlords do not have an obligation to maintain the building in a certain condition. In fact, most commercial space rentals are “as is” in Michigan. Landlords may not enter the premises for any reason, including maintenance or repairs, unless you or the tenant adds a provision to the commercial lease stating otherwise. Although tenants can make small structural changes under most commercial leases, they do not usually have authorization to upgrade or change the building’s major systems.

How can I evict a tenant for nonpayment?

These procedures are the same for both commercial and residential real estate. First, you must file the Michigan legal form 7-day Demand for Nonpayment of Rent with the court in your district. For other lease violations, the appropriate form is 30-day Notice to Quit.

Then, serve your tenant with a copy of this legal document at least three days prior to the hearing date scheduled by the court. The tenant can contest the eviction at the hearing. If the eviction is successful, the judge usually grants 10 days for the tenant to vacate the property.

Having a comprehensive lease that details both the tenant and landlord rights and responsibilities can help prevent legal disputes. You may want to have this document reviewed by an attorney who specializes in commercial property.

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