What To Keep In Mind When Signing A Commercial Lease

A commercial lease is a legally binding contract between a tenant and a landlord, this contract includes the rental details of the property and the tenancy duration.

Renting instead of buying could be due to a number of different reasons, with the most important one being lack of capital.

Commercial leases by virtue are more complicated than standard residential leases due to the lease terms and the inherent rights and responsibilities of each party involved.

Important differences between commercial and residential leases are:

1. Commercial leases have longer terms in comparison to residential leases
2. The terms and conditions of the contracts vary in commercial leases
3. The lease terms in commercial leases are normally negotiable
4. The legal doctrine that governs commercial leases is different from residential leases

Even though to some extent commercial leases have become a prerequisite for growing businesses, many entrepreneurs end up making mistakes that lead to unnecessary legal proceedings.

If you plan to draft a commercial lease in the near future, use the following tips:

5. Rent Amount

The most important factor that every entrepreneur should take into consideration is the rent amount and if the contract mentions the frequency in increase of rental rates. Every individual should make sure that their lease includes certain prerequisites for the landlord to increase the rent including clauses such as prior notice. The commercial lease should also include the annual percentage based rent increase and it should state which party is responsible for utility bills.

6. Signs

Running a business requires signs and advertisements to catch the attention of potential customers; most leases include restrictions on the use of signs.  Every entrepreneur should make sure that their contract does not include this restriction and is clearly mentioned in the lease!

7. Use Clause

A use clause is a term used to define how the tenant intends on using the property; these clauses are mentioned in the contract to basically limit the liability of the land lord. Every entrepreneur should make sure that their lease agreement includes a broad use clause in order to effectively safeguard their future interests.

This is just a glimpse into the array of factors that every entrepreneur should take into perspective when signing a commercial lease agreement.

To learn more about the different factors, simply call 020-3417-3700 to get in touch with a representative from Wembley Solicitors.  This law firm is one of the most renowned in their line of work and specializes in a variety of legal services including loan agreement disputes, Pedestrian accident claims, divorce claims and motorcycle accident claims.