Negotiating a Commercial Lease

A commercial real estate lease, like any other contract, can be negotiated.

Contract w/ Sign Here arrow

But don't use or accept a form lease. The lease should be constructed in a way that you obtain the maximum legal, economic and tax advantages.

Keep in mind that any ambiguities in the lease are usually construed by the courts against the person who drew it — in many cases, the landlord.

Get qualified legal advice before signing any contract. To fully and adequately protect your rights, here are eight important considerations in a lease:

1. A tenant can move in and start paying rent after:

2. If possession is delayed through no fault of the tenant, what are the remedies? They might include:

3. Rent should be stated as either:

In some cases, renters also use an "expense-participating lease," which involves fixed rent plus a share of real estate taxes, insurance and certain repairs.

4. Periodic rent increases should be specified according to one of the following methods:

5. Specify whether the landlord or the tenant provides and pays for heating, ventilating, air conditioning, electric lighting, water, janitorial service, security and snow removal.

6. Describe a tenant's right to remove trade fixtures. What about alterations owned or paid for by the tenant, such as improvements made at the beginning of the lease?

7. Is there a warranty by the landlord that any use, storage, treatment or transportation of hazardous substances on the premises is in compliance with all applicable federal, state and local laws, regulations and ordinances? In addition, the landlord should include a warranty that no release, leak, discharge, spill, disposal or emission of hazardous substances has occurred on the premises.

8. Is there a statement about the presence of hazardous substances on the premises before the tenant took occupancy? The landlord should agree to indemnify and hold harmless the tenant from any claims, damages, fines, judgments, penalties, liabilities and costs incurred because of an investigation of the site or any clean up, removal or restoration mandated by federal, state or local agencies.

These are only a few of the many issues involved in a commercial lease. Before signing, it is important to understand the terms contained in a lease, and also the legal and tax implications of those terms.

We Help You Get to Your Next Level™

Get in touch today and find out how we can help you meet your objectives.

Call Us