If you already know that a commercial lease is a contract between a landlord and a company to rent commercial real estate for business purposes. In that case, you may not know that these agreements are much more complex than residential contracts and that their terms can significantly impact the tenant.
So when you lease commercial space or need to modify your current commercial lease, it’s wise to consider:
- The letter of intent: this is the first document that must draft between you and the owner. It is nothing more than a preliminary agreement that outlines the critical points for both the owner and the tenant.
- Ask yourself questions like What is the expected length of the lease? How long will you occupy the space? How much of the property will you need to settle? What do you know about the landlord?
- Define the rent, which represents the base amount plus additional operating expenses and scheduled increases.
- Set the lease term, including a time for your renewal right.
- Include a security deposit based on credit, trading history, brand reputation, etc.
- Define the usage clauses to establish how you will use the spaces.
- Remember to include assignment and sublease rights. This way protects the tenant, and the business owner is reduced or sold before the lease ends.
- If you want to avoid being forced to move immediately when the lease expires, include a renewal rights clause.
- Depending on the nature of the business and the possibilities of expansion, plan and define if the owner has the means to provide you with additional space
Many other details and terms must be carefully stated in the commercial lease. Especially since, most of the time, these contracts favor the landlord. If you do not fully understand the laws, the best option is to contract a lawyer specializing in commercial leases and avoid being harmed.
At Noelia Ramos Law, we do not expect you to understand every term used in the contract. Still, we focus on assuming your part of the negotiation and understanding your rights and obligations. We take care of your investment as much as you do. Contact us for a free first consultation.