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Paid Up Capital and How it Can be Important When it Comes to Renting Warehouses or Factories

Paid Up Capital and How it Can be Important When it Comes to Renting Warehouse or Factories

As we know, most of the time when we are looking out for spaces whether commercial, industrial or residential properties, profile matters to the landlord.

Profile Matters

So, what do we mean by profile matters when it comes to rental of properties? Assuming if you are a landlord and you have purchased a property for investment purposes, who would you rent out your property to? This is exactly the case when you are a tenant looking for a property for rent. The landlord would also be curious to know who would be occupying the premises for the next few years or at least for the next couple of months.

First Impression

As a new tenant looking out for a suitable space, the landlord do not know who the prospective tenant is and hence would only have details such as the company profile reflected on ACRA business profile and on the company’s website. The first impression brought across to the landlord would usually be via corporate website and business profile.

Landlord’s Consideration & Decision

In the case of industrial spaces for rent, when the landlord looks at the business profile and considers the offer from the prospective tenant, it is likely that the landlord or owner of the warehouse or factory will take notice of the paid up capital of the tenant. The reason is because every landlord wants to ensure that rental payment is made promptly and on time on a monthly basis as mutually agreed in the tenancy agreement by both the tenant and the landlord. Any default in rental will mean opportunity cost to the landlord which is why you may consider reflecting a decent paid up capital figure in your company’s business profile if you are a business owner looking to rent a business space.

Win-Win for Both Parties

By providing a more accurate profile to the landlord, it may also sometimes be true that the tenant may also have a better chance at getting a desirable rate or close to that especially if the company is a reputable and established firm which has been around for many years and the landlord is comfortable as they know that their properties are in good hands for the next few years or months. The landlord will also be happy to proceed with the usual security deposit and not require more since the tenant is a reputable and established one. This is why paid up capital can be important when it comes to rental of properties in Singapore.