Commercial Leasing

Commercial leases are often more complex than residential leases due to the wide variety of properties and the diverse needs of different businesses. Each lease agreement can vary greatly, with terms and conditions that are typically negotiable. Whether you're a landlord or tenant, understanding the nuances of these leases is critical to making informed decisions.

If you're looking to secure a commercial lease, the first step is to work with a knowledgeable commercial leasing agent. A skilled agent will not only understand your market but will also help you find a property and lease terms that fit your specific business needs.

It is essential to thoroughly understand the duration of the lease agreement and the provisions related to its renewal or extension. Commercial leases typically span a longer period compared to residential leases, often ranging from three to ten years or more. Therefore, it is crucial to be clear about the specific term of the lease, including the start and end dates. Additionally, examine the clauses related to the renewal process, including any options to extend the lease term or negotiate new terms upon expiration. Ensure you also understand the conditions under which the lease can be terminated early, and any penalties or obligations associated with early termination.

Ensure clarity regarding the total rent amount, including the payment schedule and due dates. Understand whether the rent is a fixed amount or subject to periodic increases, such as annual adjustments based on inflation or market rates. Additionally, clarify any additional expenses that may be required. These can include property taxes, insurance premiums, routine maintenance, utility costs (such as electricity, water, and gas), and common area maintenance (CAM) fees that cover the upkeep of shared spaces within the property. Review the lease to determine how these costs are allocated and whether they are included in the rent or billed separately.

Confirm that the lease explicitly permits the intended use of the property for your business activities. Commercial leases often contain specific clauses that restrict or permit certain types of business operations. Ensure that the lease allows for the type of business you plan to conduct and that there are no restrictive covenants or limitations that could affect your business activities. It is important to understand these provisions to avoid any potential disputes or violations of the lease terms.

If you plan to make modifications or improvements to the property to accommodate your business needs, it is important to clarify the responsibilities and approval processes related to these changes. Determine who will bear the cost of these improvements—whether it will be the tenant or the landlord. Additionally, check whether you need to obtain the landlord’s approval before proceeding with any alterations. Understand if you will be reimbursed for the cost of these improvements and how such costs might affect the security deposit. Ensure that any agreements regarding improvements are documented in the lease to avoid misunderstandings.