Preparing a Commercial Property Lease Agreement
You want to lease commercial space. It may be that you want the space for a professional practice, for example. Such agreements are common, but the parties often encounter difficulties during the lease. The lease agreement should recite the basics of any contract, but it should further anticipate typical problems and provide for those contingencies. The references are two sample commercial property lease agreements. One of the basic rules is that you always put Real Property lease agreements into writing. Real Property includes anything that requires use of land or fixed structures on land.
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Instructions
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Write the agreement because the Statute of Frauds requires a signed writing for Real Property transactions. Ignore any spoken additions or modifications to the agreement unless there is fraud, in which case a court will consider evidence of the spoken communication.
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Recite the parties in the lease agreement. Include the owner of the property as the lessor and the party leasing it as the lessee. Write into the agreement the address and telephone number of each party. Use only the formal legal name of each entity. Call the Secretary of State to identify a corporation.
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Identify the property to be leased and specifically include the address and particular part of the property to be used. Recite the floor or suite to be occupied and the size of the space. Include a clause that controls what happens to improvements made by the lessee.
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Include the acceptable uses of the premises and list any uses that are prohibited, such as illegal activities. Recite other areas of the property, which the lessee may use with others, such as common areas, sidewalks and parking.
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List the lease amount, the deposit amount, the lease period, the term of the lease, and the lease schedule for clarification. Write a clause in the agreement that lets both parties know what happens upon breach. Agree to vacate the premises within thirty days of a refusal or failure to make payment.
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Provide for tort liability in the agreement. Identify which party shall be liable for all acts of negligence on the premises, but do so with the understanding that such a clause is unlikely to protect either party from tort liability. Use an indemnity clause if the other party agrees so that they will reimburse you if you are sued for personal injuries, negligence or intentional torts.
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Specify what happens at the end of the lease if the lessor agrees to allow the lessee to holdover or continue to occupy the premises. Use the standard provision that allows the lessee to lease month-to-month with up-front payment.
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References
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