Legal Issues with Renting Commercial Space

Before you enter into contract that involves renting commercial space, you need to understand the legal aspects in order to protect yourself and your company. There are several things you want to make sure to check, some more important than others.

Checklist for Commercial Leases

Before you finalize your agreement with your landlord, make sure you understand the terms of the lease agreement. Some of the things you want to look for before finalizing an agreement for commercial space rent include the following:

• Make sure you understand the financial and legal terms that are reflected in the lease agreement.
• Review the CAM (common area maintenance) charges to make sure capital expenses are included and whether the charges have a cap on them.
• Make sure the lease is clear on what repairs both you and the landlord are responsible for paying, especially those connected to heating, air conditioning and ventilation (HVAC).
• Search for an indemnification clause in case of landlord negligence.
• Is there a provision for termination of the least prior to the end of the least term?
• Is there a clause for assignment of the least (sublet) and does it require the approval of the landlord?
• The lease should specify the landlord will pay for any buildout and not pass the cost along to the tenant as a loan.
• The lease should identify the purpose of the lease: general office instead of medical office or production and warehouse.
• The lease should spell out the terms for renewal and the period required for notification prior to the end of the least term. 
• The lease should also spell out the option to relocate the tenant under certain circumstances. It should also specify that the landlord is responsible for the costs of relocating.

Understanding the Terms of the Lease

In addition to the above items, the person responsible for commercial space rent should make sure the terms of the lease are amendable to the company’s good. In other words, anything you discuss with the landlord prior to signing the lease agreement should be clearly spelled out in the commercial lease. All negotiations you made with the landlord should be clearly and concisely identified as well. Do not leave anything to chance or depend upon a verbal agreement.

Legal Assistance

Before you make a final decision about renting commercial space you need to make sure you get legal assistance. In fact, you should take the lease agreement to a lawyer for review of not only the legalities but also to make sure the terms meet your company’s needs.