A commercial lease is a lease on a building that will be used for a business purpose. A lot of people choose to lease buildings rather than purchase them. This may be because the business cannot afford to buy land, or may be because the business people don't want to have to deal with the maintenance and repair responsibilities that come with owning the land.
Commercial leases are similar to residential leases in concept, but not in all areas. Normally, commercial leases are set for a longer period of time than residential leases. Tenants often have more costs and expenses and there are usually restrictions on how the premises can be used. In most states, there are also laws on what a commercial lease can and can't contain. It is important to read a commercial lese carefully before signing, and make sure that the lease follows all the laws in your area. You may want to hire a real estate attorney who can help you to determine whether or not the lease follows commercial leasing laws.
Commercial leases typically run for more than one year, but they can also run anywhere from three to 99 years depending on the nature of the deal. The states typically require that a commercial lease be in writing if the term is for a year or longer. In order to be enforceable, there are some aspects that a commercial lease contract must address.
The contract must have a list of all landlords and tenants connected with the property, and must have a description of the premises being leased, including street address and building names or numbers. Also, the contract should list any common areas that are a part of the building such as parking areas, hallways, lobbies, or elevators.
The contract also must have a figure determining the amount of rent that the tenant has to pay, and a schedule of any increases. Commercial leases have rent that increases every year or every few years, so this should be factored in when the contract is created. Also, the contract should state when and how the money is to be paid and any charges for late payments.
The contract will also need to list the length or term of the lease. Usually if the lease has to be in writing, it will be invalid and unenforceable if it does not clearly state what is being leased and for how long. Also, the contract needs to list how much rent has to be paid and when it needs to be paid.
Most commercial leases have a variety of things to discuss. For one, the amount of the security deposit that the tenant has to pay before moving in will need to be listed, as well as how the deposit will be refunded in the future. The landlord may also want to list any conditions which would permit him to keep a portion of the deposit. Usually, if a renter damages the property then the landlord has the right to keep the deposit.
Also, the contract will need to discuss how utilities will be apportioned among tenants, and whether the tenant has to pay them directly or to the landlord. Also, the contract should discuss who is responsible for designing and paying for any improvements that the tenant needs made to the building in order to conduct business. As well, the document should discuss how much the tenant has to pay to maintain common areas, and who is responsible for insurance the property against loss from theft, fire, and natural disasters.
The contract will also need to discuss options regarding subletting the property and who is responsible for paying property taxes. If you want more information about commercial leasing contracts or need assistance in creating a commercial leasing contract contact a lawyer at a real estate firm near you today for more information!