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Commercial Lease Renegotiation: Key Terms, Tips, Legal Help

This page explains what a commercial lease renegotiation is, its key terms, and how a lawyer from ContractsCounsel can help you.

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Quick Facts — Commercial Lease Lawyers

What is a Commercial Lease Renegotiation?

A commercial lease is an agreement to rent property or land for the purpose of business. Once this lease is drafted, you can renegotiate the agreement’s terms should you feel that they don’t prioritize your needs or priorities.

Read the rest of this article to learn more about commercial renegotiation and how it works. We’ll also feature when it’s recommended to consult with a lawyer so that you can enter negotiations with confidence.

When Can You Renegotiate Your Commercial Lease?

Some common times when it makes sense to renegotiate your commercial lease include the following:

  • Your business is growing. This could cause you to want to rent out a larger space or one with various amenities.
  • Your commercial lease term is ending. This is a great opportunity in which to negotiate terms so that you avoid uncertainty. However, you should take your current business needs and market conditions into account.
  • Your commercial space needs repairs. Sometimes, commercial leases can be renegotiated for repairs, and rent price adjustments can be made to accommodate them.

How Should You Renegotiate Your Commercial Lease?

When trying to renegotiate terms in your commercial lease, you should consider the following tips so that you encourage an effective discussion.

Review Your Commercial Lease Agreement

Before you negotiate, go through your lease agreement carefully to identify any vague or unsatisfactory clauses. Think about the direction in which your business is going and how this varies since the start of your lease. This will show you if you need to make some adjustments to the agreement.

Do Your Research

You should study the market for similar lease rates and properties in your location, as this will help you gauge if the rental increase is affordable and fair.

Do some research into your business needs and concerns, so that you know what you want to gain from the negotiation discussion.

Discuss the Issue in Person

Although it might feel convenient to renegotiate your lease via email, it can be impersonal. It’s always better to chat in person as this will prevent misunderstandings or interruptions from getting in the way of the discussion.

Be Open-Minded

By staying open to creative solutions during the discussion, you could find ways to benefit yourself and the other party. Think beyond fighting for lower rental increases, as there are other benefits you could gain, such as shared property improvements or maintenance.

Here are some examples of commercial lease aspects you can renegotiate:

  • Lower monthly rent. Having more affordable monthly rent payments can help you if you’re struggling. A temporary reduction in rent could assist you through a tough time while you could agree to increase the rate afterwards.
  • Rent abatement. This setup enables you to reduce or remove your rent if business isn’t providing you with sufficient revenue. When your situation improves, you could go back to paying the full, previously agreed-upon amount of rent.
  • Sublease. You could renegotiate the subleasing terms of your commercial lease agreement, such as if you have leftover space that you aren’t using. This can help you to offset your rental costs by including other people in the agreement.

Support Your Requests with Facts

If you want to negotiate a rental price reduction after doing market research into commercial lease prices in your location, you should show your landlord your research. Similarly, if your business is struggling and you could make use of an abatement, show your landlord the data reflecting your business financials.

Keep a Record of Your Agreement

Ensure you get your new agreement down in writing so that you avoid misinterpretations or misunderstandings in the future. The terms must be transparent and easy to understand.

What are Key Negotiation Terms?

Based on your business needs, you can negotiate anything in your negotiation lease agreement. However, these are the most common terms to discuss with your landlord.

Rental Price

As one of the most important aspects of your lease agreement, you’ll want to consider the rental price and see if you can still afford it. If your landlord doesn’t want to budge on the rental price, ask about other benefits.

Repair and Maintenance

All the repair and maintenance duties have to be clearly defined in the lease agreement. Sometimes, adjusting responsibility for these can be used as a way to reach a middle ground during price renegotiations.

Alterations

If you need to make improvements to your property space, you’ll want to ensure that conditions for how these can be completed are included in the agreement.

Property Usage

Your lease should detail how the property is allowed to be used. If you need to change the usage due to new business activities, you should ensure that these are permitted based on your lease review and to protect your landlord’s interests.

Do You Need a Lawyer for a Commercial Lease Renegotiation?

Since commercial lease agreements can be complex, you’ll want to hire a lawyer to help you through the negotiation process.

Here’s what they’ll do to help you:

  • A lawyer will reveal any vague or confusing terms in your commercial lease so that you understand everything it includes, which will assist you in your negotiations.
  • They’ll help you identify what you should negotiate, based on your business needs and situation.
  • They can shift your risks, such as regarding repair and maintenance.
  • They’ll ensure you minimize your liability exposure.
  • They’ll prioritize your business goals.
  • They’ll help you gather appropriate research to support your requests.
  • They’ll identify areas where you can pursue negotiations and are skilled at helping you navigate these discussions.

Do you want to hire a lawyer for a commercial lease renegotiation?

Hire a lawyer on ContrastCounsel, an online legal network that connects clients with vetted, experienced lawyers on the platform. They have years of experience in assisting clients with renegotiating their leases. They can also review your commercial lease agreement so that it’s legally sound and protects your interests, giving you a stronger stance during negotiations.


ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


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