Starting a Business?

Lessons in Leasing a Commercial Space

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I've had worse days.

Today I took on the joyful task of calling every artist that I was about to feature in fund raisers for 2017 and explain that our plans would be shifted to 2018.

Of course, I will still be paying my rent in a space that I cannot open to the public, but it's a fantastic studio so I'm not complaining. It also helps that my store actually exists online, so it's not like sales are down. I'm lucky I get to learn this the hard way and get off easy. But for those of you in a position of leasing a commercial space (here in Albuquerque), you probably can't afford to learn this the hard way so I'll tell you the details as I find out exactly what I have to do one cliff-jumping step at a time.

The good news is that when you're starting a business and you don't know what you're doing you don't have to be afraid (as long as debt doesn't scare you). The city is both patient and friendly and everybody wants to help you succeed and teach you what you need to do. If you're trying to abide by the laws and do everything according to city codes you aren't about to be punished for taking the risk. No more than the first years of a business will punish you, anyway. (Granted I'm comparing this to serving in the Marine Corps, which is what forms my perception of what's difficult.) My particular situation is uncommon, but well worth sharing.

 

This particular situation wasn't covered in any entrepreneur start up course that I took in college, attended at the SBA, learned on Lynda.com, or found out about through business consultants in online courses (most of which are total junk btw, be careful there). This is regarding something called a Certificate of Occupancy, in the specific situation in which one does not currently exist.

Before I rented this space I was told that I would need to obtain this certificate before I could open the space to the public. When I looked into it I learned that it's typically a matter of a couple safety inspections, first by the Building and Safety Department, and then and annually by the Fire Marshall. I learned how many fire extinguishers I would need and that they expire and to replace them, and other minor details like ensuring that no electrical chords are exposed, no hazardous materials are improperly stored, etc. What I didn't know, and am still learning, is exactly what a Certificate of Occupancy is. I thought it was just an inspector looking at the safety, size, and use of the premises and determining the maximum number of people who could be inside at any given time; but there's a (an expensive) little more to it.

Every location (as in every uniquely addressed partition) needs to have blue prints that are up to code and on file with the city. When those blue-prints don't exist somebody needs to contract a licensed architect to produce the drawings. After that the drawings are submitted to the city and undergo a lengthy process of review by different departments. My art studio is what is called a "shell space" and "certificate of shell" did exist, but not for my particular address. The Certificate of Shell was for the entire building, before it was leased into seperate storefronts. Now, my particular address, has nothing on file because it has never existed before. And let's face it, one of my psychedelic rainbow paintings won't cut it; I need to hire an architect.

Most businesses don't run into this particular problem because the CO already exists or because the CO is updated by the contractors who are hired for new construction. In my case, the space was absolutely perfect in shell condition, I already had mobile gallery walls, and didn't need to do anything but paint the atmosphere (which is not considered construction). I did have to have a sign installed that met very specific requirements, but these requirements were described in fine detail on my lease leaving me with no surprises (unless you've never looked into the cost of interior lit channel letter signage before).

After getting my business license as an LLC, an EID, and CRS number coupled with a TAP account to pay quarterly taxes, a standard million dollar insurance policy coupled with the installation of an alarm system (a requirement before an insurance company will grant you that policy), all pretty common knowledge in entrepreneur circles, needing to have new blue prints drawn up and submitted for a long process of approval has been my first surprise.

 

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