Yes, Corporate customers have always been favored by homeowners. Normal! A business - a moral person - is in essence more steady than a physical person who could loose his or her job, divorce or become seriously ill. In the first case, the rent will be paid no matter what, in the second, difficulties with payments may occur, even if the person is serious.
Since international companies often pay the deposit of their employees, the latter therefore feel impelled to take good care of the furnished apartment and its inventory, being accountable to their company. Businesses do not like their security deposits not being returned at the end of the lease!
Other advantages exist such as the duration of occupation of the apartments for rent. For example, if it is a Government Institution, lease duration terms are generally between one and five years.
For international companies, Corporate rentals range from one to three years. However, there is a risk that the person occupying the rented apartment be transferred elsewhere. In this case, the company will turn to the landlord's representative or to the landlord himself, as was conducted the original contract,, and often propose another employee "Corporate" for the same apartment. The lease can then continue as a corporate lease. Some minor costs may be involved, since it is customary to write a new corporate lease for the new occupant, with his/her function in the company and the duration of his/her mission appearing in the "lease terms".
In summary, the owner of a furnished apartment renting to a Corporate tenant, is reassured for the following reasons:
Yes, rental budgets for Corporate employees are often higher than regular budgets, for they are part of a package offered to expatriate corporate employees. But, the owner's investment is usually more consequent. Indeed, the business clientele is accustomed to high standards: quality beds, modern bathroom, fully equipped kitchen, comfortable and contemporary furniture, internet in working-order.
A furnished rental usually yields between 10 to 20% more than an empty rental, seasonal or principal residence.
Yes, the owner benefits from a 50% flat-rate abatement up to 33 000 € rental income with the “micro-BIC” scheme. Beyond 33 000 €, the “simplified real” scheme looses le 50% abatement, but allows to amortize the property.
Yes, the Corporate lease is subject to the Civil Code and offers greater flexibility to both the Landlord and its Corporate tenant, in drafting the terms of the lease. The owner is free to set all the clauses that constitute the contract and the Corporate client is free to accept or request changes specific to his particular case.
The psychological side of things plays a lot in this decision. An expatriate person or family is looking for the comfort of a "home" rather than living in an umpteenth hotel. Being in one’s own apartment makes it easier to discover how people live in one’s new country. Living in a building means mingling with people native of the country, hence it is a fuller experience for the expatriate. Having neighbors, chatting a few words upon meeting at the elevator, saying hello in the language of the expatriate country makes on feel good. There is a reassuring aspect for Executives of expatriated families to belong to a community.
This is not the case in a apart-hotel where neighbors change almost every day and where all languages are spoken as in the Tower of Babel, but French. In addition, the overall cost of a furnished apartment for rent is very competitive, when reduced to its cost per day.
We tend to think that central and western Paris are the only areas sought after by business customers. However, the experience of the agency "Paris Rental" specialist in the rental of Corporate furnished apartments for 30 years, shows a different trend. Indeed, thanks to Internet, expatriate employees know more and more about Paris and its neighborhoods upon arriving in France. This corporate clientele has now specific requirements related to either culture, green areas, transportations, lively or calm neighborhoods, etc. All Paris districts seem to be cosmopolitan nowadays!
Photo by Scott Graham
Writer: Michael HELLEU
