What is Retail Lease Agreement Drafting?
A retail lease agreement is a legal contract between a landlord and a tenant for the leasing of a retail space in which to sell goods or services.
If you need to draft a retail lease agreement, read the rest of this article for key terms to include, tips to bear in mind, and how hiring a lawyer to help you with retail lease agreement drafting benefits you.
What are Key Terms in a Retail Lease Agreement?
A retail lease agreement usually contains the following key terms:
- Property description. The agreement must list all retail space details to identify what is being leased, such as the street address, layout, shared or restricted areas, and more.
- Rent and escalation. Specify the fixed rental amount paid monthly and information about annual escalation.
- Uses. Mention permitted and prohibited uses for clarity. These must be aligned with local laws.
- Security deposit. Explain what deposit amount applies and how it can be held or refunded.
- Upkeep. State which party is responsible for maintenance and repairs.
- Turnover rental. This clause means that the tenant must pay a portion of their gross sales or turnover if it exceeds a certain amount.
- Operational costs. Outline which party will be responsible for paying utilities and other expenses.
- Lease duration. State the effective start and end dates of the retail lease, as well as how parties can renew it.
What are Tips for Drafting a Retail Lease Agreement?
A retail lease agreement requires careful consideration of terms and operational specifics. Here are some drafting tips.
Identify the Premises
You must describe the exact retail space, such as by including its street address, floor size, parking rights, and common areas. If possible, you should include a floor plan for clarity.
Outline the Rent and Escalation
Your agreement must include the base rent to pay, payment deadlines, and approved payment methods. Explain annual escalation and what consequences apply for late payments.
Include Costs and Charges
You want to outline all costs and expenses that are included in the lease agreement, such as electricity, water, security, cleaning, and maintenance. It’s important to provide clarity about how each charge is calculated and allocated to prevent ambiguity and misunderstandings.
Explain Permitted Use
Make sure that you specify the permitted business activities in the retail space. Include trading hours, deliveries, noise, and customer access to create a full picture of what the space will be used for. To ensure compliance, you must confirm that the use is aligned with all zoning laws. Specify which party is responsible for verifying zoning.
Verify Maintenance Duties
It must be made clear which party will be responsible for various maintenance and repair tasks, such as structural repairs, plumbing, and equipment upkeep. Your agreement should include approval processes for repairs and alterations.
Should You Hire a Lawyer for Retail Lease Agreement Drafting?
It’s in your best interest to hire a lawyer to draft your retail lease agreement, especially if you’re unsure of what to include in it, or you’re worried about your financial obligations or any other aspect of the arrangement.
A lawyer can help you during the drafting of your retail lease agreement by:
- Considering your needs. A lawyer will discuss your business requirements and budget so that the agreement is tailored to your needs.
- Including property details. They’ll include details about the property being leased so they’re specific and clear.
- Drafting rights and responsibilities. They’ll state all roles and rights that parties have so that they understand their obligations.
- Considering property use. They’ll ensure the agreement clarifies what the premises can be used for and what activities are prohibited.
- Protecting parties’ interests. A lawyer will ensure all clauses concerning payments and rent are clear and specific to prevent hidden costs or financial obligations.
- Checking legal compliance. A lawyer will check that all agreement terms are aligned with the applicable laws and requirements.
- Advising you on implementation. They’ll explain both parties’ obligations and check what supporting documents or approvals are required. This will help you to put the lease into effect.
- Reviewing your retail lease agreement. If you’ve already drafted the agreement, you can ask a lawyer to review it for you so you feel confident that all its terms are clear and balanced.
Where to Find a Lawyer for Retail Lease Agreement Drafting
If you need to find a lawyer who can draft your retail lease agreement for you, you don’t have to call around for lawyer recommendations. Instead, you can use an online legal platform that makes it easier to connect with a verified, reputable lawyer.
ContractsCounsel is one of the largest online legal marketplaces that gives you access to a range of lawyers with experience in contract drafting and review. All lawyers have been vetted by the platform.
To ask a lawyer on ContractsCounsel to draft your retail lease agreement, here are the steps to follow:
- Go to the ContractsCounsel marketplace.
- Select ‘One-time project’ and ‘Create or update contract.’ If you’d prefer to ask a lawyer to review a retail lease you’ve already drafted, choose ‘Review contract.’
- Post your project for free. Include some information of what you require so you can match with suitable lawyers.
- Wait for bids. You’ll receive multiple bids from lawyers directly on the platform who can help you.
- Review the platform’s lawyer data. This includes information such as the lawyers’ location, years of experience, credentials, field of expertise, and client ratings for previously completed projects on the platform.
- Choose a lawyer to hire. They’ll draft or review your retail lease agreement for a flat fee.
