The Virginia commercial lease agreement is a contract between a landlord and tenant used for renting office space, retail stores, industrial buildings, or other commercial spaces.
When planning to deal in a commercial property in Virginia, you must always remember the principle of "caveat emptor" which means “let the buyer beware”, before executing a commercial lease agreement in Virginia.
Steps to Follow Before Executing Your Virginia Commercial Lease
Below are some steps you must follow before signing your Virginia commercial lease.
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Signing the Letter of Intent
People involved in a commercial lease generally sign a Letter Of Intent (LOI) that comprises the preliminary provisions of the conclusive written contract, such as the square footage, base rent, lease provisions, etc. In addition, such contracts are generally nonbinding, but the vocabulary used in this letter of intent is an enforceable and valid contract. However, you must always weigh the pros and cons of each policy before signing the letter of intent. And some letters of intent comprise a "nonstop" requirement that keeps the lessee from viewing other places while negotiations are in headway.
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Rent Provisions
Rent is one of many expenditures a commercial lessee must pay during the commercial lease provision. Furthermore, rent is typically described as primary base rent, with extra rent comprising the tenant's proportionate allocation of real estate taxes and common area maintenance (CAM) expenses.
- Step-up Expenses: These are specified modifications to the primary rent at specific phases of the commercial lease. They are developed to assess the market worth of the leased buildings at a specific time. Moreover, the lessee would want to restrict these costs to limit paying more rental expenses when the commercial building's value or the site's condition declines.
- Pass-Through or Rent Escalation Provisions: Guarantees there are no pass-through or rent escalation clauses that could be a possible shock during the commercial lease term.
- Real Estate Taxes: A commercial lessee generally pays real estate taxes on their proportional percentage of the taxes for the premises. In addition, the real estate taxes are usually charged as extra rent that increases statically per month.
- Common Area Maintenance (CAM) Expenses: These are typical expenses related to the operation of the premise and which profit all the lessees in general, including heating, cleaning, and maintenance-related expenses. Moreover, the commercial lessee usually spends a proportionate allocation of the CAM expenditures for the rental premise. Therefore, a comprehensive description of the common areas could end in higher proportional common area maintenance payments by the lessee. And you might want to try mediating the cost increase on CAM expenses.
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Personal Guaranty Provision
Personal liability provisions in commercial lease agreements are drafted to have the tenant completely and unconditionally accountable for the whole lease rent settlement in case of any default. In addition, most commercial lease contracts allow the lessor to fasten all rent settlements pending until the end of the lease period if there is a default by the lessee. These provisions are considerably expressed and give the commercial owner rights to dispose of and attach the defaulting lessee's business and private assets to fulfill any unpaid payments owed.
Conclusion
If you are unsure how to draft a commercial lease agreement, it is always better to consult our professional attorneys at ContractsCounsel. Compare multiple free proposals from vetted lawyers and save 60% less than traditional law firms - start your job proposal here.
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Meet some of our Virginia Commercial Lease Lawyers
Rebecca S.
I absolutely love helping my clients buy their first home, sell their starters, upgrade to their next big adventure, or transition to their next phase of life. The confidence my clients have going into a transaction and through the whole process is one of the most rewarding aspects of practicing this type of law. My very first class in law school was property law, and let me tell you, this was like nothing I’d ever experienced. I remember vividly cracking open that big red book and staring at the pages not having the faintest idea what I was actually reading. Despite those initial scary moments, I grew to love property law. My obsession with real estate law was solidified when I was working in Virginia at a law firm outside DC. I ran the settlement (escrow) department and learned the ins and outs of transactions and the unique needs of the parties. My husband and I bought our first home in Virginia in 2012 and despite being an attorney, there was so much we didn’t know, especially when it came to our HOA and our mortgage. Our real estate agent was a wonderful resource for finding our home and negotiating some of the key terms, but there was something missing in the process. I’ve spent the last 10 years helping those who were in the same situation we were in better understand the process.
Michael T.
I have been in practice since 1990 and practice in D.C., Maryland, and Virginia. I am an experienced litigator and look forward to resolving your legal questions as efficiently as possible.
Jonathan M.
Owner and operator of Meek Law Firm, PC. Meek Law Firm provides comprehensive business law representation, precise and informed representation for real estate transactions in the commercial and residential markets of North and South Carolina and efficient succession and estate planning for business owners and individuals.
Tina R.
15 years for legal experience; expertise in contracts, healthcare, ERISA, physicians, financial services, commercial contracts, employment agreements, etc. I am adept at all contracts and can provide you with efficient and quality services. I have worked at a law firm, financial services company, consulting ,and non-profit.
Charlotte L.
I hold a B.S. in Accounting and a B.A. in Philosophy from Virginia Tech (2009). I received my J.D. from the University of Virginia School of Law in 2012. I am an associate member of the Virginia Bar and an active member of the DC bar. Currently, I am working as a self-employed legal consultant and attorney. Primarily my clients are start-up companies for which I perform various types of legal work, including negotiating and drafting settlement, preparing operating agreements and partnership agreements, assisting in moving companies to incorporate in new states and setting up companies to become registered in a state, assisting with employment matters, drafting non-disclosure agreements, assisting with private placement offerings, and researching issues on intellectual property, local regulations, privacy laws, corporate governance, and many other facets of the law, as the need arises. I have previously practiced as an attorney at a small DC securities law firm and worked at Deloitte Financial Advisory Services LLC. My work experience is dynamic and includes many short-term and long term experience that span across areas such as maintaining my own blog, freelance writing, and dog walking. My diverse background has provided me with a stong skill set that can be easily adapted for new areas of work and indicates my ability to quickly learn for a wide array of clients.
Todd H.
20 years experienced attorney, Corp/commercial RE/wills trusts/ contracts/ reg compliance
January 4, 2022
Amy Sue L.
Ms. Leavens is a corporate attorney with 10 years of experience as the General Counsel, Chief Compliance Officer and Corporate Secretary of a Congressionally chartered, non-profit corporation, and more than 20 years of experience as an advisor to executive officers and boards of directors in for-profit and non-profit organizations. She has substantial experience within in-house legal departments managing cross-functional teams comprised of multiple business units and attorneys on large-scale mission critical projects, and within a global law firm as a manager of public and private, domestic and international, multi-party business transactions. She has unique experience implementing government-sponsored business initiatives. Ms. Leavens was honored in 2015 as one of Washington, D.C.’s Top Corporate Counsel by Bisnow and the Association of Corporate Counsel; nominated in 2014 for the Association of Corporate Counsel (WMACCA) Outstanding Chief Legal Officer Award; and the recipient in 2014 of WMACCA’s Community Service Award.
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Browse Lawyers NowCommercial Real Estate
Commercial Lease
North Carolina
How is the rent determined in a commercial lease agreement?
I am a small business owner looking to rent a space for my business. I am currently in negotiations with the landlord of a commercial property and we are discussing the terms of the lease agreement. We have reached a point where we need to discuss the rent and how it will be determined. I need to understand more about how rent is determined in commercial leases so that I can negotiate a fair and reasonable agreement.
N'kia N.
In North Carolina, commercial rent is commonly calculated as a set dollar amount per square foot. This dollar amount is usually based on factors like location, age, condition, accessibility, and amenities. However, there is no requirement for rent to be determined this way. Unlike a residential lease agreement, the terms of a commercial lease agreement can be almost anything that the parties mutually agree to. As a word of caution, in North Carolina, commercial tenants do not have the same degree of legal protections as residential tenants. For just one example, a tenant who wishes to terminate a commercial lease early may be responsible for the entire remainder of the rent unless the lease agreement says otherwise.
Real Estate
Commercial Lease
Florida
Need flat rate to do sub lease Kiosk at mall in Miami
Renting Kiosk as a sub leaser, need to verify contract and seeking a Flat rate.
Moss S.
I have been a commercial real estate attorney for over 30 years. I can review the agreement, and negotiate and draft any revisions. Considering it is in a mall, I am guessing that it is with a major retail landlord which would require review of the underlying lease. I can give you a flat rate once you request a proposal.
Contracts
Commercial Lease
New York
What's the entire agreement clause in a commercial lease?
I am a small business owner who recently signed a commercial lease for my business premises. I am concerned about the “entire agreement” clause in the lease, as I am not sure what it covers and what the implications are for me and my business. I am looking for clarification on the clause and any potential risks associated with it.
Matthew S.
This is a contractual provision which aims to prevent the party relying on it from being liable for any statements or representations (including pre-contractual representations) except as expressly set out in the agreement. It generally precludes the introduction of parol evidence or evidences of other agreements that are not in writing.
Real Estate
Commercial Lease
Ohio
How is the lease renewed at the end of the lease term?
I am a small business owner who recently signed a three-year commercial lease for my business. I am looking to understand the process of renewing the lease at the end of the three-year term. I am interested in learning more about the process, the timeline, and what I need to do to ensure that I can continue to operate my business at this location.
Paul S.
If your lease has a renewal option, then you renew by following that process, which involves giving notice during the specified time frame. If you did not include a renewal option in your lease, then you'll need to contact the landlord 6-12 months before the end of the term, and inform the landlord that you want to renew the lease. Then you'll have to negotiate the terms with the landlord.
Real Estate
Commercial Lease
Florida
How long is a typical commercial lease agreement?
I am a small business owner looking to expand my operations, and I am considering leasing a commercial space. I understand that commercial lease agreements vary in length, but I am unsure how long the typical agreement is. I would like to know this information so I can better plan for my business needs and budget.
Moss S.
The term of a commercial lease typically is no less than 3 years, and could be either 5 or 10 years. Both the Landlord and Tenant usually like long term leases.
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