Whether you are a business owner or real estate developer, it is likely that you will eventually have the need to enter into a commercial lease. The terms of commercial leases vary based on the nature of the leased space, the nature of the tenant’s business, and other concerns that may be unique to the situation. Before entering into a commercial lease, it is important to fully understand the rights and obligations of each party.
In negotiating the terms of a commercial lease it is important to clearly set forth major terms like the amount and schedule of rent payments, the length of the term of the Lease, a full and detailed description of the leased space, and maintenance and repair obligations. By setting forth these terms in the lease clearly and unambiguously, both landlords and tenants can help avoid future disputes.
Many commercial leases also contain other provisions which are meant to address the particular needs of the landlord and tenant. These may include co-tenancy provisions which allow the tenant to terminate the lease in the event a neighboring tenant goes out of business, or tenant improvement allowance provisions under which the landlord provides funding for initial upfit of the leased space. No matter the type of landlord or tenant, a commercial lease can be crafted to fit the individual needs of each party.
Understanding the terms of your commercial lease is an essential part of running your business or operating your development project. Lease disputes can be expensive and time consuming, and the best way to avoid a lease dispute is to ensure your lease is drafted to suit your needs and address a wide range of potential issues.