Commercial Lease Agreement

Since commercial tenants have specific needs and considerations distinguished from residential tenants, different laws apply to commercial tenants. 

If you are renting commercial property, use our Commercial Lease Agreement to ensure you hit all the major points in your contract that apply to tenants doing business.

What is a Commercial Lease Agreement?

A commercial lease agreement includes terms and regulations tailored to commercial tenants, such as businesses renting an office, retail, or warehouse space.

You need a commercial lease agreement when leasing a commercial property like an office building, restaurant, retail store, kiosk, or warehouse.

A written document containing the essential terms of your lease is necessary because verbal agreements regarding land and real estate structures are usually not enforceable. 

A commercial lease agreement will do the following:

• Protect your legal rights: A well-written commercial lease agreement will include terms for late fees for unpaid rent to protect you if tenants do not meet their obligations under a lease. It gives you leverage for potential settlements and simplifies a lawsuit against the tenant.
• Help ensure your relationship with the tenant is clear and well-defined: With a commercial lease agreement, you can avoid disputes about whose responsibility it is to maintain the property or to whom the building’s fixtures belong.
• Assis in rental income stability: A longer-term lease will help you avoid interruptions to regular rent payments or give you the grounds to sue for unpaid rent if the tenant leaves early.

When Do You Use a Commercial Lease Agreement?

You should find a commercial lease agreement before you start looking for a tenant for a commercial rental. 

The legal document will help you think through the terms you would ideally prefer in any lease. 

Once you have found a tenant who wants to lease your rental as part of a commercial venture, you should have tenants sign the lease agreement form before taking possession of the rental.

What to Include in a Commercial Lease Agreement Form

A commercial lease agreement should cover all the essential terms of the lease, including the following:

• Rent: You should include the rental amount, when rent is due, and how to make the monthly rent payment. You may also include penalties or fees for late rent payments.
• Description of the premises: You should include a specific description of the premises, and you may wish to state whether parking is extra or included in the rent.
• Taxes, insurance, and maintenance: A commercial lease agreement should clearly state whether the landlord or the tenant is responsible for paying property taxes and casualty and liability insurance. It should also confirm who is responsible for maintaining the property.
• Security deposit: The lease should state the required security deposit amount.
• Use: If you want the tenant to use the property only in a certain way, you should state that.
• Date of possession: A commercial lease agreement should include when the tenant takes possession of the rental, which is often different from the lease date.
• Termination date: You should include when the lease terminates, and what happens if the tenant stays after the lease period expires.
• Furnishings and fixtures: In most places, any trade fixtures, which are installed or fixed to a building used for a specific type of business, belong to the tenant, and any other fixtures that a tenant installs belong to the landlord. But your lease should specify this. A good lease will also state whether any furnishings or other types of personal property are part of the agreement.