Licence before lease: the order that saves new ventures money

Why the site should be chosen against the licence, and three checks to make before paying a deposit.

The most common mistake we see is a signed lease on a unit that cannot be licensed for the intended activity. Zoning, the building's permitted use and the unit's technical capacity all decide whether a restaurant, salon or laundry can operate there.

Before any deposit, confirm three things: the activity is permitted in that building, the unit has the power load and drainage the activity needs, and the landlord will issue the documents the licensing authority asks for.

In Abu Dhabi, mainland commercial licences go through the Department of Economic Development, with further approvals depending on the activity, such as food safety or health. The list changes with the activity, so map it on day one.

This is why we run licensing and site selection as one stage. The site is chosen against the licence, not the other way round.