A commercial lease agreement is a contract between a business owner and a landlord that states the terms and conditions of renting the property. Use our free commercial lease agreement template to include all the required data about your commercial lease.
Commercial lease agreement should be distinguished from a lease-to-own agreement, where the intention is to buy the property at the end of the lease.
This Commercial Lease Agreement is being entered into between [Lessor.FirstName] [Lessor.LastName] [Lessor.Company] (“Lessor”) and [Lessee.FirstName] [Lessee.LastName] [Lessee.Company] (“Lessee”) effective as of the following date — EFFECTIVE DATE. Lessor hereby agrees to lease to Lessee, under the terms of this Commercial Lease Agreement, the property described herein, under the terms and conditions below.
LEASED Property: Approximately SQUARE FOOTAGE of rentable square feet commonly known as UNIT NUMBER at the following address: BLDG NAME, PROPERTY ADDRESS as shown in the property map attached as Exhibit A (“Leased Property”).
The reason for designating use is to ensure compliance with zoning regulations, and also to make sure that the commercial property is properly equipped for the business use. For example, you don’t want some type of industrial work going on in an office building.
Property use: PROPERTY USE
Lease TERM: This lease will commence on COMMENCEMENT DATE (the “Commencement Date”) and, unless terminated early or extended in accordance with this Commercial Lease Agreement, end on ENDING DATE (the “Termination Date”).
Base Rent: MONTHLY LEASE AMOUNT per month
PROPORTIONATE SHARE OF OPERATING EXPENSES: Lessor will be responsible for payment of PERCENT OF BLDG percent of monthly operating expenses as described in this Commercial Lease Agreement. The current estimate for these expenses is $ ESTIMATED MONTHLY EXPENSES per month, but is subject to the conditions of this Agreement.
Security Deposit: SECURITY DEPOSIT
NOTICES and CONTACT INFORMATION:
LESSOR PAYMENT ADDRESS
[Lessor.StreetAddress] [Lessor.City] [Lessor.State] [Lessor.Country] [Lessor.PostalCode]
(prior to Commencement Date)
LESSEE PRIOR ADDRESS
[Lessee.StreetAddress] [Lessee.City] [Lessee.State] [Lessee.Country] [Lessee.PostalCode]
At the leased property
Because Commercial Lease Agreements can be lengthy and most of the terms will be the same between many Lessees of the same commercial property, it is a good idea to have the basic information listed on the first page, and then the standard terms and conditions listed after that.
The Leased Property is leased “as is.” Lessee acknowledges that neither Lessor nor any agent of Lessor has made any representation or warranty regarding the condition of the Leased Property. By taking possession, Lessee agrees that the Leased Property is in good order and satisfactory condition. The square footage set forth in this Commercial Lease Agreement is approximate and agreed to by the Parties.
Lessee, at its sole expense, agrees to comply with all federal, state and local laws, codes, ordinances, statutes, rules, regulations and other legal requirements (including covenants and restrictions) applicable to the Leased Property. In the event that as a result of Lessee’s use, or intended use, of the Leased Property, the Americans with Disabilities Act or any other Law requires modifications or the construction or installation of improvements in or to the Leased Property and/or common areas of the Property,the parties agree that such modifications, construction or improvements shall be made at Lessee’s expense.
“Common areas” referred to in this Commercial Lease Agreement means lobbies, windows, stairways, air shafts, elevators, escalators, restrooms, driveways, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and utility raceways, that have common use with other tenants of the property. Lessor has exclusive control and management of the Common Areas and may, in Lessor’s sole discretion, from time to time, (a) make changes to the Common Areas; (b) temporarily close any of the Common Areas for maintenance purposes so long as reasonable access to the Leased Property remains available; (c) or make other changes to the Common Areas as Lessor may, in the exercise of sound business judgment, deem appropriate.
On or before the first day of each month of the lease term, Lessee will pay to Lessor the Base Rent for such month. Monthly rent for the initial partial month of the lease term will be prorated. All sums and other charges payable by Lessee to Lessor in this Commercial Lease Agreement will be deemed rent. Base Rent and all other amounts required to be paid by Lessee will be paid without deduction or offset and without prior notice or demand. All such amounts shall be paid to Lessor at the address designated above, and will be treated as paid upon receipt by Lessor.
Clarify what the tenant will need to pay at the end of the lease term. Since the additional fee isn’t paid in advance, there will be a month’s worth of extra fees due at the end of the term.
In addition to Base Rent, Lessee will also pay on or before the first day of each month of the lease term the proportional share of operating expenses for the prior calendar month as reflected on monthly operating expense statements sent by Lessor to Lessee on or about the 10th day of each month. This additional rent will be calculated using the total operating expenses multiplied by the proportionate share of the building or project as identified above. Copies of the invoices underlying monthly operating expenses are available for review by the Lessee upon reasonable advance request at the office of Lessor during regular business hours.
Typical charges that fall under additional rent include shared utilities, such as internet, etc. Additional rent can also include charges for shared use of the communal spaces, parking spaces.
If any sums payable by Lessee to Lessor is not received by Lessor on the date due, Lessee shall pay a late charge equal to the greater of (a) LATE CHARGE, or (b) 10% or the highest per annum rate of interest permitted under applicable Law (whichever is less) of the then delinquent amount. A RETURNED CHECK CHARGE handling fee will be paid to Lessor by Lessee for each bank returned check.
Lessor retains the right, in the event of one or more instances of returned checks, to require Lessee to make all future payments to Lessor by wire or electronic transfer, cashier’s check or by an automatic payment from Lessee’s bank account to Lessor’s account, in each case without cost to Lessor. The acceptance of late charges and returned check charges by Lessor does not act as a waiver of any rights or remedies of Lessor.
A security deposit provides emergency resources in the event that a tenant damages the property or they terminate the agreement without warning. In these cases, the deposit can be used to repair the damage caused or to recover losses after a wrongfully terminated lease.
Upon Lessee’s execution of this Lease, Lessee will deposit with Lessor the Security Deposit identified above as security for Lessee’s full performance of every term under this Commercial Lease Agreement. Lessor will not be required to keep the Security Deposit separate from its general funds. The Security Deposit is not an advance rent payment or a measure of damages under this Lease. If Lessee fails to pay any rent due herein, or otherwise is in default of any provision of this Commercial Lease Agreement, Lessor may, without waiver of others rights or remedies, use, apply or retain all or any portion of the Security Deposit for the payment of any amount due Lessor or to compensate Lessor for any loss or damage suffered by Lessee’s default.
Within 5 days after written notification by Lessor, Lessee will restore the Security Deposit to the full amount required under this Commercial Lease Agreement. Lessor will return any unapplied portion of the Security Deposit to Lessee within 30 days after termination of this Commercial Lease Agreement. Lessee hereby waives the provisions of any specific statutes identified herein or any similar laws enacted hereafter: SECURITY DEPOSIT STATUTES.