What Makes A Good Lease Document For Commercial Properties?

Lending a commercial real estate property for lease is a complex subject matter. It requires a thorough understanding of various factors underpinning and affecting this legal document. It has to be precisely written in a concise and explicable tone. Furthermore, the parties entering into this contract must be competent and have the legal age as required by the state and federal laws. There are certain terms to be clearly specified by the landlord or owner of the commercial real estate property.

Sufficient Description of the Space to Be Rented:At the time of creating an easily understandable office lease, you must avoid overdoing it. Never try to over-exaggerate about the property in this document. Rather, it should have precise information like property name, builder name, unit address, and any other unique information that you require.

It Should Have Precise Renewal Terms:If you want to lease out your commercial property for a long time, you must allow the tenants to renew the lease and state it clearly in the agreement. Furthermore, your property manager may also add the new rental rates and rent escalation clause in it. You can also ask the tenant to give a written notice of rent renewal along with a new renewal document duly signed by them.

It Should State The Timeframe Of The Lease:You should provide a clear and precise date of lease tenure. It should state the date of beginning and ending of the agreement. You must also add the exact time of vacating in this document. This will facilitate the tenants to know the accurate time when they are supposed to check out of the property.

Clear Description of Rent Payments and Security Deposits:The rules regarding security deposits alter with the state policies. It must clearly state the amount of security, mode of payment, and interest earned (if any). Another important consideration is how to release the money at the end of tenure after ascertaining the damages. Also, specify the time that is legal to hold this security deposit at the expiry of term. Your tenant should be clearly told about the due dates of rent, mode of payment, and consequences of late payment.

It Should State Your Right to Entry and Inspection of the Property:Over the lease term, you may feel the need to enter the property for its inspection. Hence, incorporate these terms in your lease document as well. It includes the repairs to be made and authorization of tradesmen without hampering the privacy and security of your tenants.

It Must Have Concise Occupancy and Sublet Agreements:When you are leasing a commercial property, you must state the occupancy rate and sublet conditions in a clear manner. While allowing the subletting, you must specify the terms like the tenure, responsibility of the original tenant, and approval of the sub-tenant. It may seem daunting to draft this complicated legal document related to commercial real estate property for lease . Hence, you must seek the assistance of a professional and experienced property management company to handle this task.

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