Commercial Lease and Related Forms
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Commercial Lease and Related Forms Description
Commercial lease is the process by which a landlord (lessor) grants a tenant (lessee) the right to use a property without owning it. There are two main types of commercial leases: gross and net.
A gross type implies that all or specific parts of expenses beyond the flat fee (taxes, utilities, maintenance, and insurance) will be covered by the landlord. Alternatively, entering into the net lease contract binds the tenant to pay a flat rental fee and the extra expenses mentioned above. Depending on the nature of the lease, obligations regarding the costs can be modified and shifted towards either tenant or landlord.
To get the needed form, take advantage of our questionnaire. Indicate your state and choose one the following forms:
- ● Commercial Lease is a written agreement for renting commercial space to other parties in exchange for an agreed-upon payment.
- ● Office/Restaurant/Warehouse Lease is a form designed to cover the peculiarities of renting a premises as an office, restaurant, or warehouse.
- ● Commercial Sublease is a template designed to help a lessor subsidize a rent payment by subleasing the space in question to a third party.
- ● Notice of Default Letter - a written statement serving to inform a landlord or tenant about the intention of ending the agreement following the violation of a clause(s) by either party.
- ● Lease Application Form is a document containing essential information about a business applying for a commercial lease.
- ● Triple Net Lease is an agreement that binds a tenant to cover a base rental payment and some part of the operating expenses.
- ● Warning of Default Letter is a letter that informs a tenant about their failure to hold up their end of the terms and provisions in the lease.
Essential points to include in the commercial lease agreement:
The provisions for commercial lease are almost the same across all states.
- 1. Parties entering the contract
- 2. Description of the premises along with its use
- 3. Duties and obligations of lessor and lessee
- 4. Fees, expenses, and security deposits
- 5. Liability and penalties
- 6. Possibility of sublease
- 7. Date when the contract comes into effect
The list doesn’t reflect the legal aspects of a commercial lease in all states. Make sure to double-check this information with local sources and counsel.
FAQ
Usually, the new owner must fulfill the terms of the agreement. However, it might depend on the nature of the contract you signed with the previous landlord. You might want to get a lawyer’s help to go over the lease agreement if you have any concerns.
How do I get out of a commercial lease?In your commercial agreement, make sure to include a kick-out clause under which you can end the contract. Also, you can add a statement about force majeure provisions (specific conditions that you can’t control, like earthquake, pandemic, etc.).
What does NNN stand for?NNN (triple net agreement) stands for Net Net Net. It indicates three net provisions in the lease agreement: taxes, common area maintenance, and insurance. A triple net agreement is a type of contract that binds a tenant to cover base rental payment and some part of the operating expenses (net provisions) mentioned above.
What is the difference between commercial and residential leases?The key differences between these two types of rentals consist in the rental period, terms flexibility, and legal protection. Unlike in residential type, there are no stringent rules regarding how commercial lease needs to be drafted. It can be modified according to the tenants’ and landlords’ needs and expectations. Also, commercial leases are less regulated by state and federal laws.
Can I renegotiate the terms after I signed an agreement with a landlord?Yes. The most common cause for renegotiation is the reduction of the rental price. Make sure to be as transparent and detailed as possible when explaining the reason for altering the agreement. Think of the alternative terms you can offer that will be more favorable for the landlord in the long run, such as subleasing or switching to percentage-based rent.
Can a lease agreement be made orally?Technically, yes. However, the jurisdiction of most states considers a contract as valid and binding if it’s made in writing. In addition, oral agreements are difficult to enforce should any legal issues arise.
Does a lease agreement need to be notarized?It depends on a few factors. Usually, it’s not needed to verify the authenticity of a rental transaction. However, it’s mandatory in some states to notarize the agreement after a specific amount of time. Make sure to check your state’s laws before signing a new document for a commercial lease.
How To Complete Commercial Lease and Related Forms Questionnaire ?
- 1. Fill out our short questionnaire. Select the state and form based on the type of premises you’re planning to rent/lease.
- 2. Once the needed fields are ticked, you’ll be asked to choose a subscription plan to continue.
- 3. If you don’t have an account with US Legal Forms, make sure to create one.
- 4. After that, you’ll be able to get your state-specific forms.
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