If you’ll be investing in a commercial property, then it is important to know what a good commercial property lease looks like. If this is your first time creating a commercial lease, you may be surprised to see how different it is from a residential lease.
With commercial leases, tenants are expected to negotiate for your office or retail space. They should also be prepared to ask questions about the utilities included with the lease as well as deposit details, permitted uses of the property and more. As the landlord, you need to be prepared to answer questions as they come.
What should you include in a commercial lease agreement?
As a landlord of a commercial property, you want to create an agreement that is straightforward. You don’t want a tenant to say they didn’t understand something or to argue a clause in the contract later. Some of the specific items to include in your commercial lease agreement include:
· The lease term and a description of the type of lease it is
· The full rent amount (monthly, bimonthly or in whatever arrangement you’ve decided upon)
· Permitted use clauses
· Security deposit details
· Maintenance information
· Exclusive use clauses
· Renovation clauses
Additionally, inside any commercial lease, you will want to include compliance clauses, such as a compliance clause for the Americans with Disabilities Act.
It’s important to be as thorough as possible in your leasing agreement, because you don’t want to miss something important and then find that you can’t hold your tenant responsible. For example, if you don’t feel comfortable with the tenant subleasing the space, then you need to put a subleasing clause in the contract to go over that issue.
It is a good idea to have your attorney go over the commercial leasing agreement with you before you give it to a potential tenant to sign. If they have questions, you can forward them to your attorney to discuss the lease, or you can go over any changes that they’d like to make with your attorney to be sure that you’re okay with them. Being detailed with this process will help you minimize trouble later on.