A commercial lease outlines the terms and conditions when a business rents a commercial property to conduct business from that location.
It's a legally binding agreement made between a landlord, "LESSOR" (often the owner of the property) and a business tenant "LESSEE" that must be followed.
Commercial leases can help commercial landlords manage tenant relationships while protecting their business. It is critical to understand commercial leases before renting space to a small business. The type of commercial lease, terms, and termination requirements are vital elements of your contracts and affect how you negotiate the outcome.
A clear description of the space being leased, including the address, square footage, and any specific parts of a larger building or complex.
The duration of the lease. This will include the start date and end date.
The amount the tenant will pay to rent the commercial property. Note, there can be base rent, additional rent, and rent escalations.
Amount paid upfront to cover potential damages or breaches of the lease.
Defines what the leased premises can be used for (e.g., office space, retail, warehouse).
Outlines who (landlord or tenant) is responsible for which maintenance tasks and repairs.
Specifies who pays for utilities like water, electricity, and gas.
Costs associated with the upkeep of common areas in multi-tenant commercial properties, such as hallways, restrooms, and parking lots.
Terms concerning any changes or improvements the tenant may want to make to the premises.
The types and amounts of insurance the tenant is required to maintain.
A clause giving the tenant the right, but not the obligation, to renew the lease under specified terms.
Rules regarding whether the tenant can sublease the space or assign the lease to another party.
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