Commercial Lease

[rickos]

I've just joined this today. Im 22 and am trying my best to make my first million before I turn 30.
I am just about to secure a lease for a 3000sq.ft building in my own name rather than a ltd company.First of all is that a bad move?
The main aim of it is to have it as dance studios but I don't know what else to put in there to make decent money as the studios won't really make good profit? I've thought about a networking gaming area but I'm not so sure whether that will bring me a good cash flow.
Would love some ideas.

[BusinessAdviser]

For starters, YES, it is a "bad move" to have the lease in your own name. While it may be required due to your age and lack of business experience, you should attempt to procure it through an entity that will provided limited liability. Even if the lease can't be obtained in the name of an entity, you still want to create one under which to operate your business to protect you in the case that, say, someone slips on the property and is injured.

[stand856]

The best way I think would be to go the LLC way, cheap and protects you pretty good.
Say you wont be able to make lease payments, they will be able to go after your assets, (whatever you might have at your age).
Martial arts could be another thing to consider.

[Mega B]

I would say the ltd com option would be the best way to go as it limits your liability.

[BusinessAdviser]

The best way I think would be to go the LLC way, cheap and protects you pretty good.
Say you wont be able to make lease payments, they will be able to go after your assets, (whatever you might have at your age).
Martial arts could be another thing to consider.

As I prefaced though, it's VERY VERY VERY unlikely that the owner will not be required to guarantee the loan personally, so the LLC won't protect against default on the loan. However, there are still many advantages to operating the business under the entity, as described above.

[Mega B]

As the OP is based in the UK the LLC option would not be the best way forward i would have thought that is why i suggested the ltd com option.

[stand856]

I'm sure we all can agree on that securing the lease into one's name would not be the best way to go about it.
The other option for him would be to see who are the contacts for other buildings are, ie companies or individuals.

[BusinessAdviser]

As the OP is based in the UK the LLC option would not be the best way forward i would have thought that is why i suggested the ltd com option.

LLC, Ltd., Corp., it's all the same for the purpose of the information provided to the poster. The issue is whether he should use a limited-liability entity in his situation. Since he'll have to guarantee the loan personally, in all likelihood, there is no protection offered through such an entity in the case of default. However, for other reasons, limited liability is desirable.

[rickos]

Thanks for your replies. I will get back to my solicitors after the Christmas break to ask them to go back to the other solicitors to tell them I will be looking to change it to possibly a Ltd company as soon as the venue is up and ready (approx 6 weeks worth of work).
Thanks for the Karate advice.
Next Q. the rent is 3k per annum and the rates are 7500k per annum, this is good for a town centre building this size. Could I set up also as a charity to take off 80% of the rates? Is that a good option.

Thanks

[Phranksizzle]

I posted this on your other thread but I really think you should listen.
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Why would you lease a commercial space without knowing what to do with it?

If 3000 is way too big... then why not downsize?

If you want to be a millionaire before your thirty -- start thinking like one.

Not trying to be rude, just not sugar coating it. Do some research before just starting yoru business. Looks like you have cash allready, why not check out and find some local entreprenuers and invest in thier hard work, skills, and business savvy?

[rickos]

Hi yes I got the message on the other post. 3000 isn't too big. Its fine for the plans I have for the 3 studios, showerroom, reception area etc but I have a little spare space where I'm thinking I could do something to make the cash flow a bit more.
Its not looking at going through until early Feb..hence why I'm looking for ideas?
But thanks for your firm feedback.

[Phranksizzle]

Cool man, Just making sure you didnt jump into anything you couldn't get out of!

[Alana360]

I would simply like to welcome you to YE, and I hope the feedback you're getting so far is helping out with your plans. Thanks for joining, and Happy Holidays!

Alana