A Tenant’s Guide to Commercial Lease Terms

Signing a commercial lease agreement can be one of your more significant responsibilities if you are a business owner. A complex yet highly important document, your lease agreement dictates not only how you can use physical space but also how your company’s brand, culture and production can grow. By working with a commercial leasing agent, you can take steps to better understand and secure a beneficial a commercial lease.

• Premises: A commercial lease agreement must include the dimensions or square footage of the premise being leased. Because commercial square footage can be measured according to different methods, take care to understand the precise square footage included in your agreement.
• Term: Your lease term is the time period during which you will have exclusive possession of the property being leased. Your commercial real estate broker can help you negotiate a beneficial term that allows your business the flexibility to target both your short and long-term goals.
• Repairs and Maintenance: When reviewing your commercial lease, clarify responsibilities for repairs to and maintenance of the property. The landlord is generally responsible for most of the maintenance and repair obligations that arise during the lease term, but locate the stipulations within the agreement to confirm and to avoid unanticipated fines or fees.
• Recapture Provisions: The term “recapture” refers to the landlord’s right to prematurely terminate a tenant’s rights under the lease. To help you avoid this scenario, your commercial real estate broker can locate and negotiate for the removal of any recapture provisions.

For more information about commercial real estate, please contact Tom Pappas. As managing director at Studley, Inc., Tom specializes in strategic planning within the Denver market and develops real estate strategies to help his clients make sound commercial real estate decisions. Visit us online or call Tom today at (720) 259-1809.