ContractsCounsel Logo
Home Types of Contracts Commercial Lease Extension

Jump to Section

ContractsCounsel has assisted 359 clients with commercial lease extensions and maintains a network of 186 real estate lawyers available daily. These lawyers collectively have 59 reviews to help you choose the best lawyer for your needs.

A commercial lease extension is a binding contract that extends a tenant's use of a commercial property past the original lease period. As a business owner, the commercial lease you signed when you first rented your business space is one of your most important contracts. When the lease term is about to expire, it's crucial to consider whether you want to extend the lease or find a new space. This blog post will guide you through everything about commercial lease extensions.

Legal Aspects of a Commercial Lease Extension

  • Lease Terms and Conditions

    The terms and conditions of the lease extension should be clearly stated in writing, including the length of the extension, the rent amount, any changes to the lease terms, and the renewal options.

  • Rent Increase

    If the lease extension includes a rent increase, it should be clearly stated in writing, and the increase should be reasonable and in line with the current market rates for similar commercial spaces in the area.

  • Tenant Improvements

    The lease extension may require the tenant to improve the space. The lease should specify who will pay for these improvements and whether they will be considered the property of the landlord or the tenant.

  • Legal Compliance

    The lease extension should comply with all applicable laws and regulations in California, including zoning laws, building codes, and environmental regulations.

  • Legal Counsel

    It is important to have legal counsel review the lease extension terms to ensure they are fair and compliant with California law. An attorney can also help negotiate the terms of the extension to protect the tenant's interests.

  • Mutual Agreement

    A commercial lease extension in California requires a mutual agreement between the landlord and the tenant. Both parties should review and sign the extension agreement before it becomes legally binding.

  • Record Keeping

    All lease extensions should be kept in writing and maintained as legal records. This is important for both the landlord and the tenant to have a clear record of the terms and conditions of the lease extension.

Tips for Negotiating a Favorable Lease Extension

  • Start Early

    Begin the negotiation process well before the current lease expires to give yourself plenty of time to negotiate and review the terms.

  • Research the Market

    Research the current market rates for similar commercial spaces in the area to ensure the rent increase is reasonable and in line with the current market rates.

  • Identify Your Priorities

    Determine what is most important to you in the lease extension negotiation, such as rent, lease term, or tenant improvements. This will help you negotiate effectively.

  • Make a Counteroffer

    If you receive an initial offer that is not favorable, make a counteroffer with specific terms and conditions that are more favorable to you.

  • Seek Legal Advice

    It is important to have a lawyer review the lease extension agreement to ensure it is fair and compliant with California law.

  • Use Leverage

    If you are a long-term tenant with a good track record, you may have more leverage in negotiating favorable terms.

  • Be Flexible

    Be open to compromise and be willing to negotiate on some terms in exchange for favorable terms on others.

  • Maintain Good Communication

    Maintain open and clear communication with the landlord or property manager throughout the negotiation process to build trust and avoid misunderstandings.

Meet some lawyers on our platform

Daniel R.

148 projects on CC
CC verified
View Profile

Faryal A.

199 projects on CC
CC verified
View Profile

Zachary J.

383 projects on CC
CC verified
View Profile

Brian S.

15 projects on CC
CC verified
View Profile

Key Terms for a Commercial Lease Extension

  • Renewal Option: A renewal option is a provision in the lease agreement that allows the tenant to extend the lease term for an additional period of time, usually at a predetermined rent rate.
  • Rent Increase: The lease extension agreement may include provisions for rent increases, which can be based on factors such as inflation or the current market rates for similar commercial spaces.
  • Length of Extension: The lease extension agreement should clearly state the length of the extension period, including the start and end dates.
  • Tenant Improvements: The lease extension may provide tenant improvements or modifications to the commercial space. The terms of these improvements, such as who will pay for them, should be spelled out in the agreement.
  • Legal Requirements: The lease extension agreement should comply with all legal requirements under California law, such as rent control or tenant rights. It is important to have a lawyer review the agreement to ensure compliance with applicable laws and regulations.

Final Thoughts on a Commercial Lease Extension

A commercial lease extension in California can be a useful tool for landlords and tenants interested in extending a commercial lease beyond its original term. By extending the lease, landlords can maintain a reliable source of income from their commercial property. At the same time, tenants can continue to operate their businesses without the expense and inconvenience of finding new space.

However, it is important for both landlords and tenants to carefully consider the terms of the lease extension before agreeing. It may include negotiating rent increases, changes to the extension length, or other modifications to the lease terms. Additionally, it is important to ensure that the lease extension complies with all relevant laws and regulations and to seek the advice of a legal professional if necessary.

If you are looking to get free pricing proposals from vetted lawyers that are 60% less than typical law firms, you can click here to get started. By comparing multiple proposals for free, you can save the time and stress of finding a quality lawyer for your business needs.

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.

Need help with a Commercial Lease Extension?

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 11,328 reviews

Meet some of our Commercial Lease Extension Lawyers

Elbert T. on ContractsCounsel
View Elbert
4.8 (7)
Member Since:
March 31, 2022

Elbert T.

Free Consultation
Oklahoma City
3 Yrs Experience
Licensed in OK
Oklahoma City University School of Law

Elbert Thomas is the founder of the Thomas Law Group, LLC. Elbert is proficient in contract creation, drafting, reviewing, and negotiating various business contracts and demand letters in industries such as construction, personal, professional services, non-profits, and real estate. Elbert typically represents small and large companies in drafting and negotiating countless agreements such as purchase sale agreements, interconnection agreements, lease agreements, demand letters, cease & desist letters, transfer of deeds in real property, and merger/acquisition agreements. In addition, Elbert is also experienced in start-ups, small business formation, drafting operating agreements, and estate planning.

Stacey D. on ContractsCounsel
View Stacey
5.0 (32)
Member Since:
July 16, 2020

Stacey D.

Free Consultation
Grand Rapids, MI
14 Yrs Experience
Licensed in FL, MI
Stetson University College of Law

I enjoy helping businesses of all sizes succeed, from start-ups to existing small and medium sized businesses. I regularly advise corporate clients on a variety of legal issues including formation, day to day governance, reviewing and drafting business contracts and other agreements, business acquisitions and sales, as well as commercial and residential real estate issues, including sales, purchases and leases. As an attorney licensed in both Michigan and Florida, I also advise clients on real estate issues affecting businesses and individuals owning real property in either state, whether commercial, residential or vacation/investment property. I also regularly assist nonprofit organizations in obtaining and maintaining tax exempt status, and provide general legal counsel on all matters affecting public charities, private foundations and other nonprofit organizations.

Namrita N. on ContractsCounsel
View Namrita
4.9 (12)
Member Since:
August 18, 2021

Namrita N.

Attorney at Law
Free Consultation
Plano, TX
4 Yrs Experience
Licensed in MN, TX
Mitchell Hamline School of Law

Retired Dentist transitioned to Law, with a special interest in Commercial Real Estate, Startup businesses, Asset Purchase Agreements, and Employment Contracts. I love to help dentists and physicians with legal issues pertaining to licensing, credentialing, employment, and general business-legal questions.

Michael A. on ContractsCounsel
View Michael
4.1 (9)
Member Since:
August 4, 2023
Rocco D. on ContractsCounsel
View Rocco
Member Since:
August 4, 2023
Jordan P. on ContractsCounsel
View Jordan
Member Since:
October 9, 2023

Jordan P.

Associate Attorney
Free Consultation
Killeen, Texas
3 Yrs Experience
Licensed in TX
Baylor Law School

Hailing from Central Texas, Jordan Pender graduated from Baylor University in 2017 with his Bachelor of Arts degree and in 2021 he graduated from Baylor Law School with his Juris Doctor. Since August of 2021, Jordan has been working as an associate attorney for The Law Office of Gregory K. Simmons in Killeen, Texas focusing in general civil litigation. Areas of expertise include: Family Law, Contractual disputes, Business entity formation and planning, and Landlord & Tenant disputes.

Max K. on ContractsCounsel
View Max
Member Since:
August 5, 2023

Max K.

Associate General Counsel
Free Consultation
Las Vegas, Nevada
12 Yrs Experience
Licensed in CA, NY
Western State University College of Law

Transactional attorney with experience in drafting, reviewing and negotiating contracts related and ancillary to commercial leasing. Licensed in CA and NY.

Find the best lawyer for your project

Browse Lawyers Now

Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.

View Trustpilot Review

Need help with a Commercial Lease Extension?

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 11,328 reviews
Real Estate lawyers by top cities
See All Real Estate Lawyers
Commercial Lease Extension lawyers by city
See All Commercial Lease Extension Lawyers

ContractsCounsel User

Recent Project:
Commercial Lease Review for Axe Throwing Business
Location: Michigan
Turnaround: Less than a week
Service: Contract Review
Doc Type: Commercial Lease
Page Count: 25
Number of Bids: 4
Bid Range: $600 - $845

ContractsCounsel User

Recent Project:
Review Commercial Lease
Location: Washington
Turnaround: Less than a week
Service: Contract Review
Doc Type: Commercial Lease
Page Count: 5
Number of Bids: 10
Bid Range: $200 - $695

Need help with a Commercial Lease Extension?

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 11,328 reviews

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call

Find lawyers and attorneys by city