Renting out space in a historic building?
Older commercial buildings have lots of appeal. The rent is often lower, the location is frequently better, and the charm trumps a beige business park any day.
The problem is, however, that most renters don’t find this out until it’s too late.
Old buildings conceal issues. Costly issues. And a commercial lease can silently pass those issues directly to the tenant.
The good news? Almost every one of these risks can be spotted before signing.
Why Building Age Changes Everything?
Old buildings are not the exception. They are the norm.
Commercial buildings research indicates the average age of a U.S. commercial building was approximately 54 years at the close of 2022. And federal data even suggests 50% of commercial buildings are pre-1980.
Therefore most tenant leases are on buildings constructed for a different era of business, designed to a different set of codes and subjected to an entirely different set of loads.
That doesn’t automatically equal bad either. Many buildings from 1950 are in better condition than something sloppily built in 2015. It just means you can’t make assumptions.
A building that old will usually have:
- Been renovated several times, often badly
- Original structural elements hidden behind newer finishes
- Repairs nobody documented properly
- Systems running well past their design life
A structural assessment answers those questions before they turn into the tenant’s problem. It reviews foundations, load paths, framing, slabs, walls and existing movement, then deciphers expected wear from an actual structural issue. Contracting a third party structural engineering firm to perform that assessment costs little compared to a year’s rent, and you get a report you can use as leverage. You can negotiate the price, demand repairs prior to move-in or walk away.
Landlords rarely volunteer this information. Tenants have to go and get it.
What a Structural Analysis Actually Looks For?
There is a common misconception worth clearing up here. A structural analysis is not a walk-through with a clipboard.
A qualified engineer will assess things like:
- Foundation settlement and slab movement
- Load-bearing walls that were removed or altered
- Floor load capacity for the intended use
- Roof structure and water damage history
- Corrosion in steel, rot in timber, cracking in concrete
- Seismic and wind performance against current standards
Cracks are a classic example of why expertise is important in this field. Some cracks are cosmetic and entirely harmless. Other cracks follow a pattern which tells an engineer the building is continuing to move. They look identical to the untrained eye.
Floor loads work the same way. A building that’s 100 years old may have been constructed to hold light retail space. Not pallet racking, not servers, not fitness equipment or heavy filing cabinets. Exceeding floor load isn’t just a code violation. It’s a safety concern.
Nor is the big picture any brighter. America’s infrastructure earned a C+ from the American Society of Civil Engineers in 2025, which paired with an estimated $3.7 trillion investment shortfall over the next 10 years. Deferred maintenance stretches back decades. It doesn’t end at the curb.
The Lease Clauses That Quietly Shift Costs
This is where older buildings get genuinely expensive.
The overwhelming majority of commercial leases are triple net or something approaching it. The tenant pays a portion of taxes, insurance and maintenance in addition to base rent. Fine for a new construction. But add onto an old building and that maintenance item gets scary quickly.
Read these clauses slowly:
- Repairs and maintenance: Who repairs roof/foundation/exterior walls? Structural items need to ALWAYS stay with the landlord.
- Capital improvements: If the landlord replaces a major system, can expenses be passed through? Negotiate a cap.
- Lawsuit compliance: Generous language in this section can make a tenant liable for bringing an entire older building up to current codes.
- “AS-IS” acceptance: By signing this, you are accepting this product in its current state WITHOUT inspection.
- Return of premises: Often leases have clauses relating to returning the space to its original condition. This can cost more than what you spent on your fit-out.
Pay special attention to that compliance clause. Requesting a code upgrade on an existing building is easier than most tenants understand, and one renovation can trigger sprinklers, fire separation or accessibility upgrades throughout the entire building.
Accessibility, Codes and Legal Exposure
Buildings built prior to 1990 were never built to be accessible. Entrances, restrooms, door width, parking etc. fall short.
The risk is legit. Federal ADA Title III complaints topped out at 8,667 in 2025, and architectural access issues consistently comprise a significant portion of those complaints.
Tenants should know exactly who will be filling accessibility gaps before signing. Otherwise, that fight is fought after lease signing, typically with attorneys.
Building Systems Are Where the Budget Disappears
Structure gets the headlines. Systems drain the bank account.
Ask about the age and condition of:
- HVAC equipment and ductwork
- Electrical panels and total available capacity
- Plumbing and drainage
- Fire suppression and alarm systems
- Elevators, if the building has them
Power capacity is the number one issue that trips up tenants. A building wired in 1968 wasn’t designed with server racks, EV chargers or commercial kitchens in mind. Upgrading your service can cost some serious cash, which your landlord may or may not be willing to help with.
Plumbing is the silent killer. Old cast iron and galvanised pipe can fail silently and suddenly, sending a business into weeks of repairs if it bursts above a fit-out.
What to Request Before Signing?
Do not rely on a friendly walk-through and a handshake.
Request the following in writing:
- Structural drawings and any engineering reports
- Records of past renovations and permits
- Roof age, warranty and repair history
- Maintenance records for major systems
- Any known code violations or open permits
The fact that your landlord can’t produce these tells you something all by itself. Good buildings keep paperwork. Bad ones don’t.
Subsequently, obtain an independent engineer’s inspection. A landlord’s engineer report can provide valuable background information, however it wasn’t hired to represent the tenant.
The Final Word
Old buildings can be of tremendous value. Cheaper rent, better location, character and more negotiation room from your landlord.
The difference between a bargain and a disaster comes down to three things:
- A proper structural analysis carried out before signing
- A lease that keeps structural and capital costs with the landlord
- Written confirmation of who handles code and accessibility upgrades
Invest a few bucks in due diligence and the deal changes. Walk away and every latent defect in that property is a tenant issue for the duration of the term.
Inspect first. Negotiate second. Sign last.
