A commercial lease agreement is entered into between a landlord and a tenant. However, it touches on the commercial rather than residential pieces of property. It also tends to operate on a fixed-term basis rather than the month-to-month, as is the case with your ordinary lease.
Prior to the signing of the lease, a landlord will typically have to make use of a commercial rental application to check the background of a tenant. The object of this is to determine the authenticity of the tenant and whether he indeed fits the bill or not.
What is a commercial lease?
Most business entities do lease the property they operate from rather than own them. This stems from the fact that it is often more expensive to purchase those pieces of property altogether. A commercial lease lets the two parties negotiate the terms that govern the use of that said property as well as how to relocate or close shop when they no longer need to use the premises altogether.
Types of commercial lease
Like the residential lease agreements, the commercial lease agreements also come in many shades and forms. Below are some of the most common kinds of commercial lease agreements:
As you may have guessed it, the booth or salon rental agreement strictly entails the lease of the salons and hair beauty installations. It stipulates the manner in which the facility is rented out and the terms that govern such aspects as closure or abandonment of the same altogether.
This one oversees the lease and the use of the massage parlor. This is a room that is used to massage people and relieve them. The lease agreement spells out how the room is to be issued out a third party. It also pertains to how the facility may be used or disbanded after the use, as well as the rental dues.
In case you have a garage that you do not use, you may want to take advantage of the garage parking rental agreement. This one basically demonstrates how a garage is to be converted into a parking lot. It similarly showcases the terms of references that govern the conversion of such facilities for the purposes of parking cars.
Other than the garage, you may also wish to devote your facility for other events than parking. For instance, you may spare our backyard for a celebration or party event. The ‘facility event space rental agreement’ endeavors to spell out how the facility you have at hand is converted for use for that event.
Have some commercial building that may serve as an office space? The office lease agreement can help with that. It vouches for the conversion of the space for use as an office. Like any other agreement, this one too delineates the space in question as well as the rental costs and other relevant terms.
In this kind of an agreement, the tenant undertakes to pay up all expenses that arise out of the use of the said piece of property. These include insurance, taxes, and costs of maintenance. It is costly and more comprehensive to a tenant but safer to a landlord.
Some landlords allow their tenants to lease out their premises to third parties. This requires the use of the sublease rental agreement. It spells out the extent and the cost implications of such a lease if and when it is allowed to transpire.
Standard terms of a commercial lease agreement
The ‘terms of commercial lease agreements’ vary from state to state as well as with the specific kinds of property in question. Notwithstanding these inherent differences, below are some of the unifying characteristics of the lease:
- Common Area Maintenance (CAM)
- Fully Serviced Lease
- Gross Lease
- Net Lease
- Double Net Lease
- Triple Net Lease
- Gross Square Foot
- heating, ventilating, and air conditioning
How to write a commercial lease agreement?
Due to the complicity of a commercial lease, to be able to draft a good commercial lease agreement, you have to make use of a template to that end. This is basically a series of step-by-step questions that take you through the entire process of drafting the lease.
Templates (by State)
Standard commercial lease agreement template
Required clauses by State Laws
Two clauses govern the commercial leases. We stipulate them here below:
- Americans with Disabilities Act
Requires all installations that provide public accommodation or employ no fewer than 15 personnel to uphold all handicap laws. It only excludes those pieces of property that came to being prior to the passage of the Act in 1992.
- Hazard Wastes
This one compels the tenant to sign in writing that he shall adhere to all federal, state, and local laws that oversee the handling of hazardous wastes.